Diego Fusaro
Dragana Mitrović
Radoslav Gaćinović
Marijana Pajvančić
Ljubica Đorđević
Aleksandar Novaković
Dejan Milenković
Dušan Pavlović
Miloš Bešić
Luka Glušac
Aleksandra Mirović
Petar Matić
Natalija Perišić
Despot Kovačević
ISSN 1450-5460 UDK 32 No. 2/2014 Year V I Vol. 10.
Institute for Political Studies
iSSN 1450-5460 U DK N o. 1-2/2010 ii Vol. 2
1
Serbian Political Thought
ISSN 1450-5460 UDK 32 No. 2/2014 Year VI Vol. 10
Serbian Political Thought is published two times a year
Serbian Political Thought was founded in 1996 and publishing was renewed
in 2010.
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Iver B. Neumann, Research Director, Norwegian Institute of International Affairs, Oslo
Dumitru Batar, Dean/Professor, Faculty of Social Sciences and Humanities, University
“Lucian Blaga” of Sibiu
Anastasia Mitrofanova, Professor, Russian State University for the Humanities, Moscow;
Research Director, Center for Euro-Atlantic Studies, Diplomatic
Academy of the Russian Foreign Affairs Ministry, Moscow
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Domestic Editorial Board
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Ljubiša Despotović, Institute for Political Studies, Belgrade
Živojin Đurić, Institute for Political Studies, Belgrade
Đorđe Stojanović, Institute for Political Studies, Belgrade
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2
Printed by
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300 copies
Contents
Diego Fusaro
The concept of ‘commercial anarchy’ in Fichte’s The
Closed Commercial State
5
Dragana Mitrović
China in the Western East – and Beyond:
Politics and Economics of the China Plus Sixteen
Cooperation Framework
19
Radoslav Gaćinović
European Concept of the Young Bosnia Movement
51
Marijana Pajvančić
Ljubica Đorđević
Serbia in Constitutional Limbo:
Democracy without Constitutionalism
69
Aleksandar Novaković
Neo-Institutionalism and the Success Story of Capitalism:
Two Different Approaches to Social Change
89
Dejan Milenković
Serbian Public Administration Reform in the Light
of the European Administrative Space Principles
105
Dušan Pavlović
Miloš Bešić
The Budget Dilemma and Public Spending:
Evidence from Ten Postcommunist Countries
133
Luka Glušac
Securitizing Migration in the European Union:
from Openness to Ban-Opticon
159
3
Aleksandra Mirović
Petar Matić
Regional Separatisms and Independence
Referendums in Europe
179
Natalija Perišić
Health Care System between the State and
the Market – the Case of Serbia
193
Book review
Despot Kovačević
Capital, Coercion, and Postcommunist States
Gerald M. Easter
Cornel University Press, New York, 2012.
211
Citing and Referencing
217
4
Institute for Political Studies
UDC 327.56+323.174:316.32(4-12)(5-11)
Manuscript received: 10.09.2014.
Accepted for publishing: 28.10.2014.
Original scientific paper
Serbian Political Thought
No. 2/2014,
Year Vl, Vol. 10
pp. 5-18
Diego Fusaro1
Università Vita-Salute San Raffaele, Milano
The concept of ‘commercial anarchy’ in
Fichte’s The Closed Commercial State
Abstract
Fiche’s Der geschlossene Handelstaat presents a concept that, on the one
hand, plays a role of primary importance for a critique of the ‘liberal liberty’
and, on the other hand, allows for a critical understanding of the aporias of
today’s ‘neoliberal condition’. This concept is Handelsanarchie, the ‘commercial
anarchy’ of a historical world that aspires to remove every political constraint
in order to let the depoliticized economic become the undisputed master. In
the following pages, we will conduct an examination of the Fichtean concept of
Handelsanarchie in Der geschlossene Handelstaat, then we will outline some
considerations (albeit impressionistic) about its critical scope in the current
economic convergence of laissez-faire and neoliberal deregulation.
Keywords: commercial anarchy, state, liberal liberty, neoliberal deregulation.
1. Foreword
Among Fichte’s works, Der geschlossene Handelstaat (1800) is the
most affected by repression and defamation by some of the critics, perhaps even more than Reden an die deutsche Nation. The core of this
work written in 1800 is the program of commercial closure of the State:
this concept keeps to be presented as a perverse denial of the principles
of liberty. For that very reason Fichte is often depicted as a reactionary
and anti-libertarian thinker, and many critics consider this work as the
turning point (Kehre) of Fichte’s political Denkweg.
1 Researcher
fusaro.diego@unisr.it
5
For the sake of truth, Fichte was not included in the list of authors
mentioned by Popper in The Open Society and Its Enemies: however,
there is no doubt that the thinker of Rammenau, since 1800, is considered as an enemy of the ‘open society’ by every single supporter of
liberal thought. Isaiah Berlin, for instance, places Fichte among the
enemies of human liberty. Of course the liberty in question is the liberal one, i.e. the freedom of the abstract and anti-communitarian individual, who has to be protected from every intrusion by the State and
should be free to inhabit a social space that has been reduced to a mere
plane for mercantile transactions.
Certainly, Fichte aimed to fight against this concept of liberty,
but he didn’t want to deny the liberty tout court. Rather he wanted
to promote liberty in a different sense, adopting a meaning that is
both form and content, i.e., a non-liberal liberty, trying to awake his
contemporaries from the dogmatic slumber of the automatic identification between liberty and its neo-liberal interpretation. Fichte’s
struggle is still topical for us, as we are the victims of the nightmare
of the ‘end of history’.
In this regard, Der geschlossene Handelstaat presents a concept that,
on the one hand, plays a role of primary importance for a critique of the
‘liberal liberty’ and, on the other hand, allows for a critical understanding of the aporias of today’s ‘neoliberal condition’. This concept is Handelsanarchie, the ‘commercial anarchy’ of a historical world that aspires
to remove every political constraint in order to let the depoliticized economic become the undisputed master. In the following pages, we will
conduct an examination of the Fichtean concept of Handelsanarchie in
Der geschlossene Handelstaat, then we will outline some considerations
(albeit impressionistic) about its critical scope in the current economic
convergence of laissez-faire and neoliberal deregulation.).
2. Structure of Der geschlossene Handelstaat
The first of the three books of the Der geschlossene Handelstaat,
titled Philosophy, begins with a discussion around what seems to be,
according to Fichte, the greatest theoretical misunderstanding about the
essence of the State. The book discusses, in fact, the ideality of the State,
i.e. how the State should be if its ontological potentialities would be actualized. This is what Fichte calls Vernunftstaat, the ‘State regulated by
6
Diego Fusaro
The concept of ‘commercial anarchy’ in Fichte’s
The Closed Commercial State
Reason’. So the great misunderstanding in the conception of the State
- that has imposed itself in the course of history - is the belief that “the
state has nothing further to do beyond protecting the personal rights
and property of every citizen (jeden bei seinen persönlichen Rechten
und seinem Eigenthume zu erhalten)”.
In opposition to this dominant belief, the first book of Der geschlossene Handelstaat, that outlines the philosophical profile of the Vernunftstaat, is based on a different vision: es sey die Bestimmung des Staats,
jedem erst das Seinige zu geben, ihn in sein Eigenthum erst einzusetzen,
und sodann erst, ihn dabei zu schützen, “the vocation of the state to first
give each what is his, to first put each in possession of his property, and
only then to protect him in this”.
This is a statement of capital importance. First of all, the Bestimmung
- the ‘determination’ assigned to the State by the thinker of Rammenau
- has a radically different meaning from the one assumed in present
times: moreover, thanks to that very mystification, the State can present
its negation of the ideal as if it was right and natural, due to the fact that
the true vocation of the State is repressed and replaced by the perversion
where the State has actually fallen down (in a real reabsorption of the
‘ought’ into the ‘is’)2. Opposing this ideological purview, Fichte upholds
a non-liberal conception of liberty, i.e. a different perspective in contrast
with the liberal outlook that conceives the State as a mere guarantor of
individual rights and accumulated properties. The goal is to realize the
ideal, instead of the modus operandi of ideologies that are prone to adaptation, i.e. idealize the real. The State described in Fichte’s work is not
a simple and indifferent policeman that ensures the acquisition, preservation and growth of the property of individuals. Such a State is entirely
subordinate to agonal individuals, and therefore to the disruptive force
of self-referential economy that has unlimited growth as its sole purpose
and causes the dissolution of the human community - a topic that was
already discussed in Naturrecht, written in Jena in 1796-973 .
Fichte’s reasoning leads to the consideration that the duty of the State
regulated by Reason (that allows for a critical evaluation of what actually
exists and to act in view of its transformation) is rather to ensure that
each Vernünftiges Wesen, within the boundaries of the state, should
gain the free possession of what imprescriptibly belongs to him as a
2 See T. Harada (1989); also López-Domínguez (1994).
3 See: Siep (1992).
7
member of the human race. The liberal definition of the State as a force
devoted to the protection of the property of citizens is inevitably partial,
says Fichte: surely, the Bestimmung of the State consists also of this, but
it’s just a secondary moment. The Vernunftstaat, in fact, as it has been
pointed out, is the State that protects the citizen after having previously
secured the property that belongs to him as a Vernunftwesen.
The second book Der geschlossene Handelsstaat, dedicated to the
History, leaves the celestial realm of the ‘ought’ of Vernunftstaat (“State
regulated by Reason”) for a katabasis in the underworld of effective reality: the perfectly accomplished commercial anarchy, which will be thoroughly examined in the following sections of this work. This second
book is developed around the Fichtean belief that philosophical reason
has to graft itself on historical concreteness - the present time - and
act in view of the rationalization of the real, or either the realization of
the ideal. In the preamble to the second book, the essence of Fichtean
thought as a System der Freiheit4 is clarified: the transzendentaler Idealismus conceives the historical concreteness as the realm of possibilitas,
interpreting reality as a provisional and never definitive outcome of a
praxis that articulates itself in historical temporality. All that is - this is
the cornerstone of the Wissenschaftslehre (hereinafter, WL) - is the result of action, the Tat-Sache of a Tat-Handlung: as such, it can always
be transformed again in view of a concordance between the reason and
the real, between the subject-agent and the passive object5, though this
concordance is always deferred.
The dichotomy between Dogmatismus and Idealismus (dogmatism and idealism) is at the center of the ‘First Introduction to the WL’
dated 17976 and represents the necessary starting point by the light of
which, in Der geschlossene Handelstaat, we may compare the two different practical attitudes with respect to the logic of the real. While the
dogmatic believes that history is structured according to a strict necessity, i.e. a given reality to which we must adapt in a passive manner, the
idealist, on the contrary, argues that the ordo temporum coincides with
the set of free objectivations of human praxis that articulates itself sub
species temporis and, thereby, it proves to be the natural place of the
materialization of human liberty.
4 See: Pareyson (1950).
5 See: Mittmann (1993).
6 See: Hickey (2004); Betteridge (1988).
8
Diego Fusaro
The concept of ‘commercial anarchy’ in Fichte’s
The Closed Commercial State
In keeping with the principles of the WL, the object is nothing else
than the subject that has objectified to itself; therefore, it coincides with
the past of the active I in relation with its present. The subject posits the
object to itself through a contraposition; so the object is opposite and,
at the same time, identical to the subject itself. The object is the subject considered not as a deed-act (Tat-Handlung), i.e. as an action in the
present, but as a result of that activity, an objectified praxis (Tat-Sache).
The object does not have the opaque traits of unmodifiability, but presents itself as a result that is always transcendible and never definitive in
action, according to the very essence of WL as a deduction of ‘being’
from ‘doing’: according to the grammar of WL nova methodo, the not-I
is “what it endures and is determinable throughout all different determinations it receives through the liberty of the I.”
The fundamental ontological modality of the dogmatic is the necessity, while the idealist adopts the possibility. The former idealizes the
real, where the latter aims to realize the ideal. The dogmatic confuses
reality as an outcome of the free praxis with a given and unamendable
objectivity: his incurable disease, as Fichte explains in Der geschlossene
Handelstaat by openly taking up the issues already discussed in Erste
Einleitung (1797), lies in mistaking the accidental for the necessary, thus
passively surrendering to the logic of the world transfigured into Ding
an sich, a world that escapes the sphere of influence of the free transformative praxis. What ‘is’ on the ontological level, as what happens on
the historical level, is necessary for him and, as such, worthy of being
passively accepted.
For the Dogmatismus, all derives from the object, considered as autonomous from the subject. As knowledge is a mirroring of being, so
politics is the preservation of the world in its effective configuration.
The adaequatio is, at once, gnoseological and political: the knowledge
of effective reality translates into a passive adaptation to it, resolving the
possibility into reality. Conversely, for the Idealismus, everything derives
from the ‘doing’: ‘knowing’ is the action that entails the subject-objective
unity, and politics is the inexhaustible transformation of the existing in
view of its always deferred identity with the Ich. In the light of the above,
the structure of Der geschlossene Handelsstaat is even clearer. As a consistent political interpretation of transcendental idealism, the study of the
‘being’ is functional to its transformation, in order to make it correspond
to the ‘ought’. In the words of Reinhard Lauth, “our voluntas-in-actu will
determine which ‘world’ we would realize as objectively existent” (Lauth
9
2004: 57): anyway, to translate our will into action, we should be able to
know the historical concreteness in which we are living.
The third book of Der geschlossene Handelsstaat is dedicated to
Politics, i.e. a concrete way to mediate between ideality and reality, allowing the former to graft itself on the latter and reconfigure it ex novo.
The goal of politics coincides then, according to the vivid formula that
Fichte employs in the first chapter of the third book, with the “path that
leads from the anarchy of trade to its rational arrangement”.7 In other
words, politics should operationally ensure the transition from the real
State to the rational State, allowing the latter to remodel the former. This
first general framework already shows how Fichte’s thought can rightly
be considered, according to the title of the monograph by Marc Maesschalck, une philosophie moderne de l’action politique (Maesschalck
1996: 35). The primacy of action over the being, of the ‘doing’ over the
‘done’ is determined, on the political level, in the absolute primacy of the
political praxis as a concrete way through which the ideal could gain its
citizenship in the real.
The third book in Der geschlossene Handelsstaat is not only programmatically devoted to politics, namely the art of concrete Weltveränderung, but the very principles of WL, in every Darstellung, present a natural political-transformative expressiveness, not only by virtue
of their ‘defatalization’ of the existing (through the transcendent-philosophical purview of ‘mediacy of positing’), but also thanks to the infinite
Streben, devoted to make the I and the not-I coincide.
For this very reason, in the dedicatory letter of Der geschlossene
Handelsstaat, Fichte puts much emphasis on the unconditional necessity to take leave of a concept of politics that could be qualified as
‘empiricist’. According to the empiricist vision (which is the political
declination of dogmatic fatalism), politics coincides with the mere realism, that is, with the simple and disenchanted analysis of the present
conditions, without ever supporting the claim to transcend the boundaries of reality and lean towards the ideal (Wallwitz 1999). Here we understand clearly in what sense Der geschlossene Handelsstaat should
be read in continuity with the earlier writings of Fichte and how it can
be considered as fully consistent with the main structure of the WL as a
‘system of liberty’ (System der Freiheit), including its code of deduction
of being from liberty. The deeper meaning of the text written in 1800
7 SW, III, p. 476.
10
Diego Fusaro
The concept of ‘commercial anarchy’ in Fichte’s
The Closed Commercial State
is actually based on rediscovering the meaning of possibility against the
triumphant mystique of necessity, together with defending the process
of emancipation of mankind - a topic already treated in its most explicit
form during the lessons held in Jena in 1794 about the Bestimmung des
Gelehrten (Oesterreich 1999).
3. Handelsanarchie and the breakup of States
From the point of view of the transcendental idealism of WL, the
attention to the historical concreteness is subordinate to the will to redesign the schemes of reality. This is, after all, the project clearly outlined
in the second book of Der geschlossene Handelsstaat, perfectly consistent with the principles of Fichtean Strebungsphilosophie. In order to
accomplish such a mission, one needs to be aware of the actual configuration of power and power relations, of the gap existing between
the reality and the ideal, between how things are and how they might
be. In other words, the study of concrete reality should not be aimed
at neutralizing the possibilitas according to the hegemonic vision, but
to maximize it instead, through the practice of operational translation
of the ideal in the real. It is precisely for these reasons that - explains
Fichte - gegenwärtig haben wir diesen wirklich eingetretenen nur zu
schildern, welches ein Theil der Zeitgeschichte wäre, “at the moment
we shall outline this actual state, which is etched in the history of our
time”.8 Moreover, the title we chose for this book, History, is a generic
term, as Fichte adopted the more specific formula Zeitgeschichte: it refers mainly to the most recent times of history and, therefore, it could
be more accurately translated as “history of the present time”, in order
to underline how the Fichtean interest in the Closed Commercial State
revolves around a knowledge of present that should be functional to the
transformative action.
Fichte, in the second chapter of the second book about History, defines in a clearer way the concept of Handelsanarchie, assumed as the
cipher of the present time. The title of this second chapter is of particular importance: Die bekannte Welt als ein einiger grosser Handelsstaat
angesehen, “The known world considered as one great unitary commercial state”.9 Here Fichte outlines - with an adherence that should in8 SW, III, p. 449.
9 SW, III, p. 450
11
duce to reflect those who persist in dismissing him as a thinker who
doesn’t pay attention to the dynamics of historical concreteness10 - the
situation of the world ruled by the anarchy of trade that has unified the
globe and started a process that, if not stopped in time, will result in the
suppression of national realities and cultures in favor of the universal
monarchy of the profit, elevated as the sole leading criterion of human
life and management of politics (Maesschalck 1996: 104). Fichte argues
that liberal politics has no principle to oppose to this condition, because
it completely shares the idea that the State is necessary to ensure the
property: the liberal idea symbolically duplicates what already is, i.e. the
actual submission of politics to the autonomized economy, resulting in a
reduction of the State as a mere guarantor of the mos economicus.
Fichte identifies the genesis of this immense and global Handelsstaat
with the formation of Christian Europe itself: lassen die Völker des
neuen christlichen Europa sich betrachten als Eine Nation, “the peoples
of modern Christian Europe may be considered as one nation”.11
In this framework of unity provided by Christian Europe, the gold
and silver currency was universally recognized and, ipso facto, it made
possible the exchange across borders. This exchange has gradually become the basis for the establishment of the modern Handelsstaat and of
the ruinous Anarchie that ensued. Christian Europe, united by faith and
values even in a plurality of cultures and languages, constituted a whole,
in which the autonomy of the parties was respected:“ If Christian Europe
was a whole, then the trade of the Europeans among themselves must
be free”.12 Subsequently, Fichte argues that the situation has been perversely turned upside down: the economy is autonomized and, thanks
to the Christian unity, tends to destroy the cultures and to impose itself
as the only principle of reference. The positive Christian unity has been
dialectically reversed in its denial, in the false universality of the trade as
an end in itself, which drags peoples, cultures and values that form the
basis of the Christian civilization down into the abyss.
This is what Fichte describes in this passage as the modern Anarchie
des Handels that we have to fight for the harmful effects it entails. At
this point, Fichte takes up what he argued since the publication of the
first book of Der geschlossene Handelsstaat: if the duty of the State is to
10 See: Crone (2005); Gurwitsch (1924).
11 SW, III, p. 450.
12 SW, III, p. 453.
12
Diego Fusaro
The concept of ‘commercial anarchy’ in Fichte’s
The Closed Commercial State
protect each citizen in his property after having secured him into it, so
that his basic needs are firmly satisfied, then we must fight unconditionally against that force - the Handelsanarchie - which tends to destroy
this balance.
This is a decisive conceptual turning point that should be analyzed
in detail. The Handelsanarchie destroys the primacy of the human
over things, of politics over economy, and produces what Carl Schmitt
defined as “depoliticization”, i.e. the deprivation of politics and its reduction to a mere ancilla oeconomiae. Commercial anarchy regularly
turns down into political anarchy. For this reason, the overcoming of
the traditional state form, according to the dynamics that are coessential with the anarchy of trade, constitutes an unavoidable step towards
the depoliticization, in order to annihilate and weaken any politics that
would be still able to act on the economic in a way that could regulate
it and put it at the service of the human Gemeinschaft. The inefficiency
of the entities of the State is the condition needed to impose the two
convergent principles of commercial anarchy and integral depoliticization of the economic sphere. These are two great evils that characterize
the present time that Fichte, in Grundzüge des gegenwärtigen Zeitalters
(1806), qualifies as Stand der vollendeten Sündhaftigkeit, “The Age of
Completed Sinfulness”.13
The fact that the liberal State is a mere formal guarantor of property
that does not take care of the substance is the preferred way to subsume
politics under Handelsanarchie, reconfiguring it as a simple mean to
achieve trade’s own goals, and reducing it to a tool at the service of the
mos economicus. As specified in the sixth chapter of the second book,
“Trade interests ultimately give rise to political concepts that could not
be more perilous”.14 These concepts, if read in a transparent way, reveal
themselves to be absolutely functional to the consolidation of the immense power of the economic negative. Paraphrasing the well-known
Carl von Clausewitz’s formula, politics is now debased and reconfigured
to be a mere continuation of economy by other means. In the opinion
of the thinker of Rammenau, this is the mortiferous condition in which
Europe has fallen into: a continent now debased as an immense Handelstaat, where the laws of economics are forcing people into misery and
disintegrating every form of communitarian solidarity.
13 GA, I, 8, p. 201.
14 SW, III, p. 468.
13
Concerning the diseases that arise from the anarchic situation generated by the depoliticized economic, Fichte discusses them in the third
chapter of the second book of Der geschlossene Handelsstaat, programmatically entitled “The reciprocal relation of the individuals in this great
commercial state”.15 The Handelstaat, modelled according to the principles of’ Handelsanarchie, and therefore on the basis of depoliticization
and destructuration of every state form that could be able to put up any
kind of resistance, brings into being the exact opposite of what Fichte
identified in the first book as the essence of the Vernunftstaat. In this
State, as we have seen before, and as reminded by Fichte en passant also
in this book, the money would be equally distributed among individuals, so that everyone would have an equal right for an equal amount of
the existing goods: equal liberty would be the foundation of a State built
in accordance with the principles of ordo ordinans of reason, as Fichte
pointed out in the first book on the Philosophy.16 The issue of equality is
at the center of every work and every phase of the Fichtean reflection17,
and it was theoretically founded in 1794 during the lessons held in Jena
on the Bestimmung des Gelehrten.
The immense commercial State of Europe, destined to become global, stands as the exact opposite of the Vernunftstaat outlined according
to the principles of the WL. In place of communitarian solidarity, the acquisitive and selfish individualism ends up to dominate; in lieu of moderation, excessiveness becomes the norm; the social peace is replaced
by the perpetual struggle between individuals, reduced to social atoms
who feel hostile to each other like Hobbesian wolf-men, eager to have it
all to the detriment of others.
Fichte describes in no uncertain terms the global scene of Handelsanarchie, interwoven with injustice and conflicts, selfishness and sad
passions, misery and exploitation18. Therefore, the historical reality of
the present time is configured as the greatest denial of the ideal that one
can think of. In practice, in this historical situation there is no other way
to be idealists other than to operationally oppose the Handelsanarchie
and supporting the theory of the State regulated by Reason, which is
the only power able to curb commercial anarchy by repoliticizing the
15 SW, III, p. 454.
16 SW, III, pp. 454-457.
17 See: Schenkel, 1987.
18 SW, III, pp. 454ss.
14
Diego Fusaro
The concept of ‘commercial anarchy’ in Fichte’s
The Closed Commercial State
economy and restoring the primacy of the human Gemeinschaft over
the anonymous and self-referential mechanisms of the absolutized
economic. Human solidarity gives way to the sad spectacle of ruthless
competition, in which each man aspires to destroy his fellow man: kurz,
keinem ist für die Fortdauer seines Zustandes bei der Fortdauer seiner
Arbeit im mindesten die Gewähr geleistet; denn die Menschen wollen
durchaus frei seyn, sich gegenseitig zu Grunde zu richten, “In short, no
one will be provided with the slightest guarantee that, if he continues to
work, he will continue to enjoy his present state of existence. For men
wish to be completely free that they may destroy one another”19.
In the fourth chapter of the book on Zeitgeschichte, Fichte thoroughly investigates and radicalizes the logic of the previous one, i.e. an
examination of the oppositional relations among individuals within the
State. Fichte now explores - so reads the title of this fourth chapter - the
Gegenseitiges Verhältniss der Nationen, als Ganzer im Handelsstaats,
“The reciprocal relation of the nations as wholes in this commercial
State”. Even at the international level, the Handelsanarchie gives rise to
a condition that is closely akin to the status naturae outlined by Hobbes: the States face each other as magni homines, with a menacing and
gladiatorial attitude20. Each sees in the other the traits of a dangerous
commercial rival that has to be subdued, or else annihilated.
The bellum omnium contra omnes traces the ‘horizon of sense’ of
the immense Handelstaat, in which the autonomized economic ends up
to occupy the entire space that used to belong to the national political,
forcing the latter to share the senseless goal of the former - the valorization of value - and producing, thereby, colonialism and imperialism,
both demonized by Fichte from the dedicatory letter onwards (Thomas-Fogiel 2004: 235). So Fichte considers the commercial closure of the
State as the only possible way to realize the Vernunftstaat, by means of
the neutralization of commercial anarchy in order to grant equal civil
and social rights for all.
The commercial closure will make possible, according to Fichte, the
regulation of economy by politics (allowing the State to be as economically sovereign as it is legally), and will prevent the rise of colonialism
from the anarchy of trade. Fichte condemns colonialism in no uncertain
terms, as well as he does with the subjection of his fellow countrymen to
19 SW, III, p. 458.
20 See: James (2011: 419).
15
the economic relation of domination and inferiority made possible by
the unregulated economy. In the closed commercial State, Fichte says,
“No one can be cheated, and no one will need to cheat another. And if
he wished to do so out of a pure love of fraud, he would not find anyone
whom he could cheat”21.
Also the fifth and sixth chapters of the second book of Der geschlossene Handelsstaat are thoroughly exploring these issues and, in particular, contain a vibrant condemnation of the rampant sinfulness of the
present time. In particular, the sixth chapter attempts to demonstrate
how, when a nation has conquered the commercial hegemony, other
nations are forced to undermine it, in order to restore a balance: if they
can’t do so at the expense of the dominant nation, they will inevitably
turn their efforts toward the weakest ones. This context of unlimited potential for conflict, generated by the auri sacra fames, leads every nation
to relentlessly try to expand itself beyond its borders, in order to become
an economic power: in this process, all nations are potential losers, and
especially the most vulnerable ones.
The thinker of Rammenau outlines the condition of upheavals and
conflicts that characterizes the scenario of Handelsanarchie and, with as
much farsightedness, foreshadows how wars between States always arise
from the ‘economic question’, from the lust for domination and profit.
The relations among States are replicating on a larger scale what happens in the relations among the conflictive individuals within the State,
who are subjugated by the power of the absolutized economic.22
According to Fichte, social harmony, intended as the foundation of
the communitarian ethos, can only be achieved by the closure of the
State at the commercial level. For this reason, once more, the geschlossene Handelsstaat is the only way suggested by reason to react to the current disintegration of the ethos23 and, secondly, to pursue the ideal of an
universalism of emancipation, different from the ‘bad universality’ put
into practice by the Handelsanarchie.24
In light of what we have been saying, can we argue that the Fichtean
critique of commercial anarchy, and the related therapy consisting in a
re-politicization of the economy mediated by the State form, could find
21 SW, III, p. 462.
22 See: Wood (2004).
23 See S. Furlani (2005: 45-46).
24 See: Picardi (2009); Picardi (2012).
16
Diego Fusaro
The concept of ‘commercial anarchy’ in Fichte’s
The Closed Commercial State
its place in present times, in the era of globalized and completed sinfulness? Even if we don’t agree with all the solutions proposed by Fichte
(starting from the very idea of Verschliessen des Handelsstaates), his
diagnosis is hard to refute, in particular for which concerns the perspective of the neutralization of the political by the autonomized economic
obtained through commercial anarchy.
As suggested by David Harvey, globalization is the flexible and postmodern form of imperialism, i.e. the exact opposite of the soothing and
irenic universalism of human rights, as it is presented by the politically
correct pensée unique. For this reason, in the pages of Der geschlossene
Handelsstaat, we can identify in nuce the understanding of the dynamics of internationalization of the market and of its tendency to produce
a space delivered from any political and decisional sovereignty, that is,
where the only sovereign is the autonomized economic moment. We
live, in fact, in the age of Handelsanarchie, hailed today by neo-liberal
policies such as deregulation, always pursued in the name of a global
laissez-faire.
If properly brought up to date, the therapy proposed by Fichte could
form the basis for a critique of the present that may outline the possibility of an alternative future. The teleological orientation of the process
of emancipation of mankind, which coincides with a cosmopolitan, international, unified, organic and stateless community, composed of free
and equal individuals, requires transformative action as a medium .
It needs the mediation of the power of the State. In Fichtean terms,
the State is called upon to play the role of a particular that, by standing
against the logic of the globalized Handelsanarchie, should universalize
itself in order to gradually reverse the trend in view of a communitarian cosmopolitanism. This will be based on the universal recognition of
individuals as parts of a single Gemeinschaft that will include mankind
as a whole.
Bibiliography:
Betteridge, H.T. (1988) “How to make an Idealist: Fichte’s Refutation of Dogmatism”, in The Philosophical Forum, XIX (1987-1988).
Crone, K. (2005) Fichtes Theorie konkreter Subjektivität. Untersuchungen zur ‘Wissenschaftslehre nova methodo’. Göttingen: Vandenhoeck&Ruprecht.
Furlani, S. (2005) Libertà economica e controllo politico. Lo «Stato commerciale
chiuso» di Fichte. Milano : Franco Angeli.
17
Gurwitsch, G. (1924) Fichtes System der konkreten Ethik. Tübingen.
Harada, T. (1989) Politische Ökonomie des Idealismus und der Romantik: Korporatismus von Fichte, Müller und Hegel. Berlin: Duncker und Humblot.
Hickey, L.P. (2004) “Fichte’s Critique of Dogmatism. The Modern Parallel”, The
Philosophical Forum, 35(2004): 65-81.
James, D. (2011) Fichte’s Social and Political Philosophy: Property and Virtue.
Cambridge: Cambridge University Press.
Lauth R. (2004) Con Fichte, oltre Fichte. Torino: Trauben.
López-Domínguez, V.E. (1994) “Individuo y Comunidad: reflexiones sobre
el eterno círculo fichteano”, Daimon. Revista de Filosofia, 11(1994):
139-154.
Maesschalck, M. (1996) Droit et création sociale chez Fichte. Une philosophie
moderne de l’action politique. Louvain: Peeters.
Mittmann, J.-P. (1993) “Tathandlung und absolutes Subjekt”, Philosophisches
Rundschau, 40(1993): 274-290.
Oesterreich, P.L. (1999) “Die Einheit der Lehre ist der Gelehrte selbst. Zur personalen Idee der Philosophie bei Johann Gottlieb Fichte”, Fichte-Studien,
16(1999): 1-18.
Pareyson, L. (1950) Fichte. Torino: Edizioni di Filosofia, 1950 [second edition
with the title Fichte. Il sistema della libertà, Milano, Mursia, 1976].
Picardi, R. (2009) Il concetto e la storia: la filosofia della storia di Fichte. Bologna:
Il Mulino.
Picardi, R. (2012) “Geschichte und europäische Identität bei Fichte”. In: C.
Binkelmann (ed.) Nation – Gesellschaft – Individuum. Fichtes politische
Theorie der Identität. Amsterdam/New York, NY: Rodopi. pp. 123-147.
Schenkel, F. (1987) Individualität und Gemeinschaft: der demokratische Gedanke
bei J.G. Fichte. Dornach: Spicker.
Siep, L. (1992) “Naturrecht und Wissenschaftslehre”. In: M. Kahlo et al. (eds.)
Fichtes Lehre vom Rechtverhältniss. Frankfurt a. M.: Klostermann. pp.
71-91.
Thomas-Fogiel, I. (2004) Fichte. Réflexion et argumentation. Paris: Vrin.
Wallwitz, G. (1999) Fichte und das Problem des intelligiblen Fatalismus, in:
Fichte-Studien, 15 (1999): 121-145.
Wood, A.W. (2004) “Kant and Fichte on Right, Welfare and Economic Redistribution”, in: International Yearbook of German Idealism, 2(2004): 79-85.
Zöller, G. (2012) “‘Nation commune’. L’idée fichtéenne d’une histoire universelle de l’Europe au point de vue cosmopolitique”. In: J.-C. Goddard and
J. Rivera de Rosales (eds.) Fichte et la politique. Monza: Polymetrica.
18
Institute for Political Studies
UDC 327.56+323.174:316.32(4-12)(5-11)
Manuscript received: 15.09.2014.
Accepted for publishing: 21.10.2014.
Original scientific paper
Serbian Political Thought
No. 2/2014,
Year Vl, Vol. 10
pp. 19-50
Dragana Mitrović1
Faculty of Political Sciences, Belgrade
China in the Western East – and Beyond:
Politics and Economics of the China Plus
Sixteen Cooperation Framework
Abstract
World economic crisis has focused, intensified and notably eased realization
of huge Chinese interests in Europe and European Union. On the other side, it
has significantly influenced change of the EU’s attitude towards China, which
suddenly for some has become appreciated big investor, and even saviour of the
EMU through purchasing the EFSF bonds, as well as Union’s economy on the
whole. For the others, she remained a threatening imposer. Important alarming
point of such attitude change supporting the later position has been reviving of
the economic cooperation between China and Central and Eastern European
countries thru “China plus Sixteen” framework. For Chinese and crisis stricken
countries in Central and Easter Europe it was more promising and matching
interest cooperation between investments and technology hungry CEE countries and China in global dispersing asset-acquisition process. Long history and
tradition in cooperation since the very birth of the People’s Republic and absence of political preconditioning only supported the issue.
Keywords: China, Central and Eastern European countries, Serbia, “China
plus Sixteen”, EU.
1. “Go Global” – coming to Europe
Along with the continuing traditionally strong Chinese economic
engagement primarily in Asia, she has become a big donor and investor
1 Professor; Executive Director
dragana.mitrovic@fpn.bg.ac.rs
19
in Africa2 and Latin America, too, but - in accordance with her high
leaders’ repeated announcements in 2009, 2010 and later, in Europe,
too. Very obvious and attention causing Chinese growing financial
involvement in the First and Second World countries, including
European ones, has been happening as part of the realization of the “Go
global” strategy3. Regarding Europe, particularly noticeable Chinese
interest was seen in Mediterranean area, where some 30% of All Chinese
“European” investments concentrated since the outbreak of the global
economic crises in 2008 and in the next several years. Although some
analysts saw recent Chinese economic interests in countries that recently
has become or are about to become EU members, as an attempt to get
shorter or cheaper way to the EU market, that engagement extended
wider – into Central, Eastern and South-Eastern European countries.
It looks more realistic to conclude that China is using every open door
to enter the EU, but also European market as a whole, as another global
economic partner.
China has strong motivation to invest in strategic infrastructure
in South and South-Eastern Europe that has been most obvious to
majority of observers of the Chinese rapprochement. Those sectors in
Serbia, but also in Greece and most of the “Plus Sixteen Countries”,
have strategic importance as situated on the crossroads of major interregional and intercontinental routes. Also, traffic infrastructure has
been neglected sector of their relevant national economies and for this
reason is expected to have strong growth, which makes them profitable
and wise investment choices. Additionally, an important development
that is being arranged is the influx of the Chinese funds through
bilateral loans, concession arrangements, share placements and foreign
direct investments (mostly joint ventures) into these countries thusly
creating what many define as a long-term strategy of Beijing to make
a significant foothold in one of the most strategic placements of the
European Continent.
2 According to the OECD data, the biggest impact of Chinese investment has been in
Africa where her foreign investment amounted to near $51 billion a year since 2007. In
proportion to the size of the economy, Chinese direct investment in Africa has been five
times larger than in the rest of the world.
3 “Go Global” Investment Strategy Needed for Chinese Enterprises, People’s Daily
9/12/2001[online], Available at: http://www.china.org.cn/english/GS-e/19033.htm.
[Accessed 4 December 2014].
20
Dragana Mitrović
China in the Western East – and Beyond:Politics and Economics
of the China Plus Sixteen Cooperation Framework
On the other side, China enters the very EU market through
every channel it finds or creates – including the highly costly traffic
infrastructure project in Greece, member state that has serious problem
with sustainability of its economic model and liquidity of its economy,
which did not prevent China to make long-term investment of 2.5
billion US$ into renting the Piraeus seaport for thirty five years (and
others focused on its’ modernization4), the main Greek trade port that
is at the same time strategically positioned between three continents:
Europe, Asia and Africa5. Four years later, a total US$ 4 billion deals in
shipping, trade and energy were signed by China and Greece during
visit by Premier Li Keqiang to Athens in June 2014 as continuation of
the numerous deals between state and business representatives from
the two countries agreed in May 2013 during Greek Prime Minister
Antonis Samaras to Beijing. Chinese firms were about to invest into
international airport, regional airports, ports, railways, tourism, real
estate and metal production.
During 2010 Wen Jiabao’s visit to Europe (his tour included Belgian,
Italy, Greece and Turkey) Chinese side also announced acquirement
of Greek state bonds and formation of the regional investment fund
for the South-Eastern part of Europe, run by one of the”the big four“
Chinese state-owned banks: China Development Bank. During the
high-level visit Chinese corporations’ intentions to rent Thessalonica
seaport were also expressed, as well as interests for investments in
railways, airports, shipbuilding, telecommunications, tourism and
agriculture. Several years later, after two “China plus Sixteen” summits
and ahead of the third one in Belgrade, in December 2014, the Piraeus
seaport investment as well as the interest in modernization of Greek
railways look like a first step in realization of the strategy.
The mentioned 2010 visit also had important role to eliminate
scepticism of some political and academic circles in the EU about the
very nature of the Chinese intensions. Chinese Prime Minister Wen
Jiabao asked for undisturbed access for Chinese companies while
announcing and making new business deals, which paved the way for
long-term significant presence of the Chinese companies and state
in the whole Europe. Beyond realizing “Go Global Strategy” Chinese
4 http://www.dredgingtoday.com/2013/01/15/piraeus-container-terminal-onmodernization-path-greece/
5 http://www.sofiaecho.com/2010/06/16/918011_china-agrees-to-invest-in-greece-inspite-of-moodys-downgrade.
21
companies were about to spread their financial surplus into more
geographically dispersed baskets, including such attractive ones within
EU, that, thanks to the debt crises, became more economically and
politically accessible in the process of this “reverse FDI” process. In
those acquisitions Chinese companies could gain unusual gains for the
investors – to acquire latest technology and managerial skills.
Numerous business deals announcements (Mitrovic 2013a: 168169) and numbers of high level visits sent a clear message about Chinese
importance in European financial market, within different European
economies, but also in EU and European market as a whole. The total
quantity of debt bonds of Greece, Italy, Spain, Portugal, Germany and
few other EU states that were purchased by China remained unclear
due to the cumulative nature of her and EU’s relevant statistics. On
the other hand, Chinese side has repeated several times warnings and
responsibility pleads towards EU partners that proved its determination
towards investments that she considered challenging, but still very
attractive.
Together with appeals for bigger Chinese involvement in this process
came the opposite ones, too. From the very beginning of this process,
some analysts and politicians within EU saw such development as a
threat to economic and geopolitical independence of European Union,
as allegedly China has been becoming important economic, but also
political factor within EU and Europe by using problems of the EMU
economies to empower its influence over certain countries, but over the
EU as a whole, as well. Such scepticism arouse sharply and multiplied
after Chinese initiative of the “China Plus Sixteen”. Also, leftist circles
criticized Chinese deals as harmful for workers’ rights, as their critique
was aimed at their own government 6
Some analysts supported the fear of asset-stripping, where Chinese
investors were allegedly going to invest in EU companies and, once they
got the ownership of the company, took all the assets to China with
closing the company in Europe and laying-off the workers. Another
version of that prejudice based accusation was that Chinese companies
were investing in Western companies only to be able to get access to
6 Typical example was case of Greek, where in the publications of the International
Committee of the Fourth International (ICFI), Greece-China business deals were
scrutinized from that point. Consult: Vassilopoulos, J. in „China’s premier signs
major trade deals with Greece“, 24 June, 2014. Available at: http://www.wsws.org/en/
articles/2014/06/24/grec-j24.html.
22
Dragana Mitrović
China in the Western East – and Beyond:Politics and Economics
of the China Plus Sixteen Cooperation Framework
their technology and then transfer that technology back home and
use it in local company to become as advanced and competitive as the
original company. As local company in China had other advantages
of lower labour costs etc., at the end of the day it would shut down
the original company bought by Chinese investors in EU and left its
workers jobless. Such fears could also be seen as cultural repulsiveness
towards changes in the globalised world and rise of the emerging power
coming from other civilization. While traditionally FDI was evidence
of superiority and power of the Western economic powers, the reversed
flows opened highly unpleasant “existential questions about where the
world was headed. Is the West in decline while China is rising? Is this
the end of the Western world?”7 Although such development comes
naturally along the road, it expresses reservations and prejudices
towards China that exists within certain circles in Europe. Also, fears
that Chinese corporations will withdraw their capital, technology and
by these working places from the companies they bought in Europe,
proved to be untrue. On the contrary, Chinese companies have
strengthened many industrial branches in Europe, according to the
OECD, that points Volvo’s acquisition by Jeely in 2009.
Chinese approach, though, is very pragmatic and similar to the
Russian one, and that is making valuable bilateral business arrangements
with individual EU member countries, which reduces a lot negotiating
power of the EU as a block. On the other hand, such approach sometimes
enables member states to achieve national interests on the expense on
the EU’s one or without seeking for consensus decision on each and
every individual case. Also, it is for sure that nominal devaluation of
many assets within Europe made possible for China to maximize the
effects of its investments in potentially prosperous and strategically
located parts of Europe, especially those on the crossroads between
Europe, Middle East and Russia.
Mr. Wen’s last visit to EU in capacity of the Premier of the PR
China in 2012 that proved to be double dissatisfying (Mitrovic 2013:
4) almost corresponded with the “alternative” Chinese approach to
Europe, e.g. through comprehensive, but firstly economic, cooperation
with the Central and South-Eastern European countries through for
7 Meunier, Sophie, “Chinese Foreign Direct Investment in the West”, Georgetown Journal
of International Affairs
May 28, 2014. Available at: http://journal.georgetown.edu/chinese-foreign-directinvestment-in-the-west-five-minutes-with-sophie-meunier/
23
the purpose created and financed framework. In April 2012, Prime
Minister Wen Jiabao met in Warsaw high envoys from 16 Central and
South-East European countries at the economic forum (announced a
year before in Budapest) introduced twelve measures for development
within “sixteen + one”, including establishment of the Secretariat in
Beijing within Ministry of Foreign Affairs and credit line worth 10
billion USA$ for support of the future projects, among which some 30%
of the amount would be financed under the preferential conditions for
the third world countries. Projects in the area of infrastructure, hightechnology, renewable energy will be prioritized, while China will try
to stimulate “16+1” trade as to reach value of 100 billion US$ by 2015
(double than current value of it), build one economic development high
tech zone in each of the 16 countries in next five years, organize “forums
of cultural cooperation” with each of them, provide 5,000 scholarships
for students from those countries to study in China, organize the first
political forum of the youngsters, etc. Under the given framework,
Serbia proved to be especially active and attractive at the same time,
as this strategically positions state already attracted over 1.6 billion of
the preferential funding (one project financed this way is bridge on the
Danube “Zemun-Borca” and the other is two-phased revitalization of
“Kostolac B” thermo power plant) and 303 million US$ for the projects
of two parts of the planned high-way construction on the Corridor XI.
The first two projects got high level political support, since Wu Banguo’s
visit to Serbia in 2010.
2. Chinese enlarged engagement in the Central, Eastern and SouthEastern European countries
Growing Chinese involvement into economies of Eastern and
Southern Eastern European countries shows primarily that China
has significant commercial interest to be present. There is an obvious
interest of China to invest into traffic infrastructure in this part of the
world – from ports, railways, roads, bridges, but also into agriculture,
energy industry, renewable energy sector, auto-industry, electronics, as
well as in trade, tourism and financial services.
On the other side, China invests in this part of Europe for the reason
it invests anywhere around the Globe: to expend its’ export markets,
to gain missing resources, including strategic goods, like fertile soil,
water, but also stakes of the automobile industry or energy businesses
24
Dragana Mitrović
China in the Western East – and Beyond:Politics and Economics
of the China Plus Sixteen Cooperation Framework
that became relatively cheap as their shares lost much of its value. As
results of the mentioned we saw relatively robust Chinese investment
in Belarus, Ukraine and countries from “plus sixteen” framework Hungary, Romania, Bulgaria, Macedonia, Serbia, Montenegro, etc.
Additionally, beyond investing small part of her foreign reserves,
employing some of her plentiful workforce, China has been sending
powerful message to her major business partners about her high
technological, managing and overall business capacities as the bridge
on the Danube (“Zemun-Borca”), constructing the new “Kostolac
B” thermo power plant in Serbia and high speed railways between
Belgrade and Budapest are set to be exemplary models for similar
investments of Chinese companies in other South-Eastern and other
European countries.
China has also been creating an alternative entrance to its’ biggest
foreign market – the EU – and Europe as a whole, under Chinese lease
and administration, as in sea port of Piraeus. Unavoidable collateral
gain China gets out of the process is undoubted geopolitical influence.
Central and South-East European countries as former communist
countries have history in doing business with China, even exporting
technology and experiences of their first steps in transition during the
first phase of the Chinese reform and opening up project. Especially
after the EMU crises they rediscovered China as promising investor
and reliable partner. Also, they have relatively cheap and skilful work
force and do not press China with ideological issues.
When President Hu Jintao visited Croatia in 2009, it was the
first highest-level visit from China to the region and the first time
that Chinese intention to develop economic relations with all the
countries of the region was announced8. During the visit, and later,
Chinese companies expressed interests to invest into Rijeka seaport,
and into railway line Rijeka-Zagreb, that would fit into wider Chinese
positioning into transport and producing capacities in Europe. Croatia
also lift visas for Chinese tourists during the summer season that was
welcomed.
One important ingredient of the cooperation is that there are no
open questions among China and 16 states and there is history of
traditional friendship and cooperation, as well as mutual wish and
interest to upgrade the cooperation. As Chinese President Hu Jintao
8 http://www.chinadaily.com.cn/china/2009-06/20/content_8305867.html
25
pointed in Zagreb: ”China has always respected sovereignty and
territorial integrity of the South-European countries, as well as the
development model chosen by the peoples of these countries”. In that
sense, economic, political and every other aspect of cooperation with
China, flatters each of these countries.
The next year, 2010, the second person in China’s state hierarchy
– Wu Banguo, visited Serbia and declared the preferential financing
and building of the now famous “Chinese bridge” on the Danube in
Belgrade (Zemun - Borca). Those were marks that both countries
appeared on the priority list of the Chinese foreign policy agenda. Very
important were the words that Chinese president Hu put in Zagreb
2009, stressing that China supports speedy Croatian access towards
EU, as well as similar choice made by all the countries of the region
as Croatian prompt admission would facilitate Croatian economic and
general development that would give impetus to similar development
of the other South-Eastern European countries. By such process they
would all become much more qualified Chinese partner in economic
and general cooperation. Cooperation with China is, unlike with major
Western powers, on the equal footing, with no subordinating treatment
nor humiliating preconditioning. In that sense, too, all countries of the
region are feeling very stimulated to deepen cooperation with China,
although in some of them there were concerns that such development
could harm their close ties with countries that – paradoxically have
China as high priority global partner. Where it comes to Serbia and
its problems with self declared Kosovo independence, it is especially
important for her that China as permanent member of the UNSC and
strong supporter of the UN global management is a guarantor of the
UNSC Resolution 1244.
Beyond the two mentioned high level visits to Croatia and Serbia,
there are also other elements that contribute to the impression of
much stronger political presence of China in the region. As a state that
oppose unilaterally declared independence of Kosovo and guarantor
to the UNSC 1244 resolution that keeps the runaway province within
Serbia, for the first time China behaved proactively when taking part
into debate before the ICJ in Hague, against unilateral secession.
Also, Chinese police forces took part into UN missions in Bosnia and
Herzegovina and in Kosovo.
Chinese and Romanian cooperation has long tradition (Romania
recognized PR China only three days after it was established and in
26
Dragana Mitrović
China in the Western East – and Beyond:Politics and Economics
of the China Plus Sixteen Cooperation Framework
2014 they celebrate 65 years of diplomatic relations and 10 years of
establishing “comprehensive friendly and cooperative partnership“).
It had continuously developed even during the split with the other
communist countries within the Eastern bloc. Since 2000, trade volume
between the two countries has increased by ten folds with Romania
exports to China growing by big margin. Under support of the
government, Chinese companies have steadily increased investment
in Romania. The two sides have developed cooperation in the areas
of science and technology, education, culture and military exchanges.
They have maintained sound coordination and communication on
regional and international issues. Chinese President Hu Jintao visited
Romania in 2004 when the two countries established a “comprehensive,
friendly and cooperative partnership”.
China remains Romanian biggest Asian trade partners with
significant trade of some 3.76 billion US$. Trade volume impressively
growth by 20% annually as Romania has been “rediscovering” Asian
partners since the shrinkage of the biggest EU markets of the Romanian
export. In some 9,000 Chinese firms (mostly joint ventures) a half of
1US$ billion, mostly private capital, was invested. Those firms are mostly
engage in trade, close manufacturing, tobacco production, wooden
furniture, sweets, mining, energy, automobile industry and tourism.
Many of those investments are twenty years old, while lately presence
of the Chinese trans-national corporations from telecommunication
and IT sectors like Lenovo and ZTE was obvious.
Big blow was done to the cooperation by Romanian action on
demolishing China Town (Nile) in Bucharest, when some 3,000
Chinese little shops and property of some several million EUR was
destroyed, after which Chinese who sustained loss complained before
the EU institutions. After a year the new Chinese centre was open
with significant Romanian efforts to repair the damage and turn again
toward Chinese partners, as after excellent star, they were strongly hit by
retreat of the Western financial assets at the beginning of the EU crisis.
In August 2011, Romanian Prime Minister Emil Bloc visited China,
first time after he was elected in 20099. He urged Chinese investors
to take part in building infrastructure, as well as in joint ventures in
energy sectors, agriculture and transportation. Romanian side stressed
its readiness to keep playing an active role in promoting EU-China
9 http://english.peopledaily.com.cn/102839/7568348.html
27
relations as well as cooperation between Central and Eastern European
countries and China. Xi Jinping visited Romania in 2009 in the capacity
of Vice President. In April 2011 Li Changchun went to Bucharest in the
capacity of Standing Committee member of the Political Bureau of the
Chinese Communist Party Central Committee.
In 2013 Chinese Premier Li Keqiang visited Romania, as the first
Chinese Premier to visit that country in 19 years, and Romanian
Prime Minister Ponta was in China as that year Bucharest was the
host of the second summing of the „China Plus Sixteen“ Meeting of
Heads of Government of Central and Eastern European Countries
and China10. Romania, according to her Prime Minister Victor Ponta,
wanted to become China’s most important partner in Europe, both
economically and politically11. The Romanian side even before the
Bucharest summit started presented prepared projects worth some 8.5
billion Euros that could be realized with Chinese financial support,
which is much needed around the region. Among those projects are
reactors 4 and 5 of the Cernavoda nuclear power facility on the Black
Sea, as well as Hi-tech parks producing for the European market. In
2014 Chinese Vice Premier Zhang Gaoli visited Bucharest calling “to
work out a new road map to emphasize the direction and highlights
in the future development of ties” and mentioning energy cooperation
in carbon- hydro- and nuclear-electricity as already have achieved
important progress and calling for more efforts to upgrade cooperation
in infrastructure construction, such as in high-way and high-speed rail
building, and encouraged farm product import from Romania12.
Before this latest wave of investments and interest, China had
invested relatively big in Hungary, where Bank of China, one of the
four top Chinese banks and one of the world biggest five hundred
corporations has been operated. On June 24-26 2011, Chinese Premier
Wen Jiabao visited Hungary that for many seemed to be the central
Chinese point at this part of the world. Hungary, then closing out
its term as rotating presidency of the EU Council of Ministers, was
though, engaged in purely bilateral dialogue with high Chinese guest.
During the visit, Wen and Hungary’s Prime Minister Victor Orban
10 http://gov.ro/en/news/the-bucharest-guidelines-for-cooperation-between-china-andcentral-and-eastern-european-countries
11 http://www.dw.de/china-knocking-at-europes-back-door/a-17255036
12 China, Romania agree to enhance cooperation, September 19, 2014, Xinhua, http://news.
xinhuanet.com/english/china/2014-09/26/c_133675122.htm
28
Dragana Mitrović
China in the Western East – and Beyond:Politics and Economics
of the China Plus Sixteen Cooperation Framework
signed a dozen agreements worth around 3.6 billion US$, which the
Hungarian government proclaimed would create thousands of jobs in
the country13. High level visits from China continue with the next year
visit of the Chinese vice Premier Li Keqiang on April 30, 2012, when
he met with Hungarian acting President and Speaker of the Hungarian
Parliament Laszlo Kover14. Hungarian Prime Minister Viktor Orban
visited PRC in February 2014 when he was received by President Xi
and Premier Li. During his visit that marked the 65th anniversary of
China-Hungary diplomatic ties and 10th anniversary of their “friendly
and cooperative partnership” both sides announced deepening
cooperation in infrastructure construction, finance and investment,
and agriculture15. Other sectors that experienced investments from
Chinese companies were chemicals, machinery, home appliances,
telecommunications, R&D, finance, agriculture, tourism.
During the visit of Polish President Bronislaw Komorowski, the first
Polish head of state to visit China in 14 years, two presidents signed
a joint statement extending bilateral relations to a level of strategic
partnership in Beijing on December 20, 2011, the second one that
China established with CEE countries. Poland “rediscovered China”
only after becoming EU member and tried to make maximum out of
its new position by performing truthfully on „both tracks“, unlike the
previous period in which Poland and Check Republic offended China
several times and according to Chinese views expressed “superior
mentality towards China on issues concerning political system, human
rights, religion and other values”16 that caused Chinese leaders to keep
distance towards CE transitional countries. Only Chinese pragmatism
helped to put aside these processes and let the new initiative come out.
The helping argument was that Poland as a big European country had
a solid potential to soon become China’s biggest trading partner in the
region. When the trade volume between the two countries was only
US$ 144 million in 1991, it increased to US$ 14.38 billion in 2012.
13 http://chinaelectionsblog.net/?p=1724
14 http://www.fmprc.gov.cn/eng/zxxx/t928652.htm
15 “China, Hungary Vow Further Cooperation”, China Invests Overseas, at: http://www.
china-invests.net/20140213/32428.aspx
16 Long, J., (Nov 21, 2014, Beijing), “Relations between China and CEE Countries:
Development, Challenges and Recommendations”, China International Studies No.3
Available at: http://www.ciis.org.cn/english/node_521155.htm, Accessed on November
23, 2014.
29
The break-through visit included 150-strong delegation, which
consisted of business people, scholars and high-ranking officials
such as the Polish economy minister, according to Chinese media.
In 2004, they built friendly cooperative partnerships and after that
steadily extended the cooperation in politics, economy, humanity,
global affairs and have made fruitful achievements, the statement
said. Poland welcomes investment from China as direct investments,
financial investments such as the purchase of Polish treasury bonds,
and participation in the privatization of Polish state-owned enterprises
in the fields of infrastructure, energy, research and development,
mining, auto manufacturing and heavy industry. Poland also initiated
launching of education forum at Beijing Foreign Studies University for
closer student exchanges and cooperation.
In accordance with its adopted national strategy of transforming
national economy into export-oriented and competitive one, Bulgaria,
another EU member and according to Chinese media the second
country “in the world to recognize the People’s Republic of China17”,
has started unwrapping the project of setting up industrial investment
zones in its several strategic points, e.g. transition lines towards Greece,
Turkey and on few inter-continental crossroads on its territory. For its
cooperation with China the Bozhurishte Industrial Zone (former heavy
industry complex) is of special importance as many Chinese companies
are about to start production there in accordance with the economic
cooperation memorandum signed between the two governments18.
According to official Bulgarian data, Chinese investments for the
period 1996-2010 were only 15 million US$ worth. But during 2009
and 2010 official contacts of the relevant ministries from both sides
were intensified. Especially was obvious Bulgarian attempt to include
China in revitalization of its water ways, ports and railways. In 2011
minister of transport took part in the meeting of the Chinese and
Turkish officials to seek way for Bulgaria to join the fast train railway
“Asia-Europe” project. Bulgarian officials emphasize the confidence of
the Bulgarian offer for Chinese investors, while realizing the SouthEastern competition it has been facing.
But from 2010 industrial park within the Bozhurishte Industrial
Zone started functioning as joint venture company run by Zhejijang
17 http://www.chinadaily.com.cn/business/2014-11/10/content_18894469.htm
18 “China to Invest USD 1.5 B in Bulgaria, Chamber Chief Says”, Novinite.com, May 3, 2012.
Available at: http://www.novinite.com/view_news.php?id=139014
30
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China in the Western East – and Beyond:Politics and Economics
of the China Plus Sixteen Cooperation Framework
Province and Bulgarian National Company Industrial Zones, on the
bases of economic cooperation between this Chinese province and
Bulgarian government from the same year. In March 2011 one of the
wealthiest Chinese provinces, Jiangsu, joined the project (Jiangsu alone
invested abroad a billion US$ in 2009). Automobile parts factory was
open near Lovech by the end of 2011 as FDI of Chinese Great Wall
Motors, Glass factory in Ragrad as FDI of Luojang Float Glass and solar
park in Ihtiman, As investment of Polar Photovoltaics. Tianjin State
Farms Agribusiness Group established a wholly-owned subsidiary
in Bulgaria in 2011 and announced to add an extra investment of
100 million euros ($125.15 million) to build an industrial park for
agricultural products processing in 2014.
By the end of 2011, Chinese investments in Bulgaria have reached
a total of 70 million US$, as, according to the Chinese Embassy in
Bulgaria in 2011, the Chinese investments in the country grew by
320% year-on-year, with new investments in telecommunications, car
manufacturing, energy, agriculture.
Port Varna on the Black Sea was seen as another place for the
construction of other industrial park facility in Bulgaria with the
Chinese funding. Renewable energy, infrastructure and agriculture
are two of the key sectors where Bulgaria is going to see most of the
future Chinese investments with approximate value of 1.5 billion US$,
according to high level officials from both side19.
Trade between Bulgaria and the PRC hit the record in 2011 when
it reached 1.3 billion US$, according to data of the Bulgarian National
Statistical Institute. Bulgaria’s export to China grew by 61% year-onyear, reaching 403 million US$, and in just a decade it became forty
times bigger, although not big enough to bit China’s export to Bulgaria,
that was worth 943 million US$M in the same 2011. Bulgaria was
mostly exporting copper, aluminium and some electric equipment,
where China exported durable consumer goods, machinery and
industrial equipment.
Also, Bulgaria enjoys the status of approved tourist destination
according to a memorandum between the EU and China’s national
tourism administration.
Not all the attempts were successful. In November 2009, Dongfeng
Motor Group Ltd., China’s largest truck maker, signed a memorandum
19 Ibid.
31
of understanding with Serbia’s state-owned truck manufacturer
Fabrika Automobila Priboj from the Serbian city of Priboj. Dongfeng
was supposed to control the product and the brand, while FAP was
due to handle the manufacturing. Surprisingly, later the deal was
off permanently. Also, in 2013 the privatization of the Serbian wine
company “Vrsacki vinogradi”, acquired by Chinese private company
was annulled by the relevant state authorities due to the missteps in the
process.
Beyond upgrading bilateral cooperation with all of the to be “Plus
Sixteen” countries, China expressed steady interest to upgrade economic
cooperation with Belarus, Ukraine and Moldova, countries out of the
“plus Sixteen”, in accordance with their economic capacity and political
readiness to engage in cooperation with China. For the obvious reason
of dealing with these countries separately, China performed the very
similar pattern and way of engagement. Belarus for both reasons
was the biggest beneficiary of its position, as it was not submitted
to (in)formal complaints from the EU and IMF about receiving
unconditioned Chinese loans. In 2011, Beijing’s trade with Ukraine,
Belarus and Moldova was around US$12 billion20. China has been
constant highest priority in Belarus President Alexander Lukashenko’s
foreign policy, which proved to be so right with deterioration of the
economic situation in 2013. His last visit to Beijing was in July 201321,
among many high level visits from Belarus side, while Chinese Prime
Minister Wen Jiabao visited Belarus in 2007, at the time Vice President
Xi Jinping in 2010, Head of the People’s National Congress Wu Banguo
in 2011, as well as high level military delegation in November 2014.
As a result of high level meetings over the past two decades, Beijing
has made credit lines available to Belarus worth a total of 6 billion
US$, while several contracts for joint projects have been signed. Also,
there has been constant growth in trade as twenty years since the
establishment of diplomatic relations mutual trade has grown almost
100 fold – from 34 million US$ to 3 billion US$ in 201122. It’s interesting
that only since 2006 China achieved surplus in the bilateral trade. In
2011, China was the ninth largest market for Belarusian exports and
20 http://www.osw.waw.pl/en/publikacje/osw-commentary/2012-05-28/ukraine-belarusand-moldova-and-chinese-economic-expansion-east
21 During the visit 20 agreements, documents and protocols were signed regarding trade
and investment worth 1.9 US$ billion.
22 http://china.mfa.gov.by/rus/relations/trade/
32
Dragana Mitrović
China in the Western East – and Beyond:Politics and Economics
of the China Plus Sixteen Cooperation Framework
the third largest exporter to Belarus. It’s interesting that only since 2006
China achieved surplus in the bilateral trade. Belarus predominantly
exports potash fertilizers to China (44% of total exports), and China
exports mainly processed goods to Belarus. Joint projects were worth
5.5 billion US$ in February 2012, and the US$10.5 billion still available
as part of the credit line opened to be utilized over the next few years.
According to the Belarus Embassy in Beijing, projects already realized
are BeST mobile phone network, capacity enlargement of the Minsk
power plant, construction of housing block and a hotel in Minsk and
technology upgrading of the three cement factories. Beyond these,
the planed projects have value of some 8 billion US$, including the
biggest one – industrial park in Smalyavichy23. Beijing is also interested
in buying Belarusian technology (mostly machinery for agriculture
and large construction vehicles) and for that reason joint ventures
have been established in China, mostly in Harbin, with Belarusian
companies BelAz, MTZ and GomSelMash with production assigner
for local Chinese market. In an attempt to reduce newly emerged
deficit the big Belarusian companies have, according to official sources,
opened trade offices in China. After four years of preparation, on June
19, 2014, the foundation stone was laid in suburbs of Minsk for the
China-Belarus Industrial Park project, a major investment project of
SINOMACH in following the Go Global strategy and promoting the
industrial structure transformation and upgrade, according to its CEO.
He stressed that SINOMACH would fulfil responsibilities of stateowned enterprises and build the China-Belarus Industrial Park as “a
model of overseas investment projects, a landmark of economic and
trade cooperation between China and Belarus, and a ‘shining pearl’
in the Silk Road economic belt”24. The project is based on the newly
signed Strategic Cooperation Agreement as joint venture of CAMCE
and Harbin Investment Group Co., Ltd from China (collectively
accounting for 60% of the shares) and Minsk state government, Minsk
municipal government, and Horizon Capital from Belarus (collectively
accounting for 40% of the shares). The China-Belarus Industrial Park
focuses on key projects in industries such as electronic information,
23 http://www.osw.waw.pl/en/publikacje/osw-commentary/2012-05-28/ukraine-belarusand-moldova-and-chinese-economic-expansion-east
24 Chairman Ren Hongbin Visits Belarusian President Alexander Lukashenko, SINOMACH
Webpage, June 30, 2014. Available at: http://www.sinomach.com.cn/templates/T_news_
en/content.aspx?nodeid=161&page=ContentPage&contentid=37451.
33
biomedicine, fine chemicals, high-end manufacturing, and logistics &
warehousing.
When it comes to another East European partner – Ukraine – China
has been becoming more and more important trade and investment
partner. Regarding the growing trade, Ukraine has been mostly
exporting crude ore and importing processed goods. Several big joined
projects have been ongoing. The main are bullet train line from Kiev
to its airport, part of the ring-road around Kiev and upgrading of the
state-owned Melnykov coalmine in Lugansk region25. According to
President Yanukovich, Ukraine planned to raise $1 billion of Chinese
investment for its coal industry.
China, which currently consumes about one-fifth of the world’s
food supplies is very interested in high-quality farm products that vast
fertile plains of central and east Europe can produce in great quantity,
especially those that are blessed with „golden belt“ stretch over their
territories, like Ukraine or Serbia. But, bank liquidity and drop in
investment and consumption were some of the huge problems pressing
Ukraine economy when in 2013 China signed a deal with Ukraine to
farm an area of 31 million square kilometres financed with a $3 billion
loan from China. It added a lot of confidence to Mr. Yanukovich and his
government, together with Russian offer to buy $15 billion of Ukrainian
government bonds, and to reduce by 33% the price of natural-gas
exports to the country26. According to this deal with China, Ukraine
was supposed to modernize its agriculture also with using selected
seeds, farm equipment, building a fertilizer plant and a highway in the
Crimea and a bridge across the Strait of Kerch, an important industrial
centre and a channel between Ukraine and Russia connecting the Sea
of Azov and the Black Sea27. This was happening a week after at the
time President Yanukovich refused to sign a free trade agreement at the
EU Eastern Partnership meeting in Vilnius, Lithuania, together with
610 million Euros – which he called “a nicely wrapped piece of candy”
– offered by the EU to upgrade the economy to Brussels standards.
25 “Ukraine to raise $1 billion of Chinese investment in coal industry, says Yanukovych”,
Kyiv Post, Aug. 26, 2011. Available at: ttp://www.kyivpost.com/content/business/ukraineto-raise-1-billion-of-chinese-investment-i-111719.html
26 Rayman, N., “Russian Gives Ukraine Financial Lifeline Amid Protests“, Time, December
17, 2013
27 Ivanovitch, M., “Central and Eastern Europe are Courting China”, CNBC, December 1,
2013. Available at: http://www.cnbc.com/id/101237467#.
34
Dragana Mitrović
China in the Western East – and Beyond:Politics and Economics
of the China Plus Sixteen Cooperation Framework
Beyond this reported pattern: trade, infrastructure, energy - China
and Ukraine are involved in several R&D projects28, transfer of military
technology and weaponry (including the famous 60,000 ton unfinished
Soviet aircraft carrier, formerly known as “Varyag”, that China bought
from Ukraine in 1998 as an empty shell and turned it into its first aircraft
carrier). According to the Russian press, military cooperation includes
aircraft building, tank construction and in air defence and practically
would mean selling secret Soviet military technologies29.
Some analysts saw “hidden Dragon action here” saying that China
treats the political dialogue merely as an instrument which helps it
achieve its economic goals30. The priority Chinese interest is to invest
part of its financial surplus in the form of low-interest loans secured with
government guarantees. The model of China’s engagement is described
as typical of the entire engagement in Eastern European region. The
ultimate goal of the model, seen by its critics, is to support Chinese
export: companies from China operating in the region are suppliers of
the engaged equipment and technologies and the main contractors in
infrastructural projects which are financed with Chinese loans. In turn,
the scale of direct investments is small, host country’s trade balance
gains bigger and bigger deficit as import from China – construction
materials and machinery used in the projects, have been growing.
On the other hand, others see Chinese one billion US$ loan
for infrastructure projects offer to Moldova31, as well as Chinese
investments in energy and infrastructure sectors in Serbia as almost
pure geopolitics and strategic positioning. Governments and business
communities, from their side, are getting more and more ambitious
with incorporating Chinese growing presence into their own political
and economic agendas and along with this go rising seriousness of their
pro-China deals engagements.
28 Three Chinese-Ukrainian technology parks in Jinan and Harbin and within the ScientificTechnical Complex „The E.O. Paton Electric Welding Institute” of NAS of Ukraine.
29 China hunts for both Soviet and US military technology, “RT.com”, August 15, 2011.
Available at: http://rt.com/politics/soviet-china-military-technology/.
30 http://www.osw.waw.pl/en/publikacje/osw-commentary/2012-05-28/ukraine-belarusand-moldova-and-chinese-economic-expansion-east
31 In 2009, the China Overseas Engineering Group (Covec) was to conduct infrastructure
projects with a total value of one billion euros - amounting to some 10 percent of Moldova’s
entire GDP. L. O’Neill, “China is gaining a foothold in Russia’s backyard”, FT.com, 28 July
2009, www.ft.com.
35
3. “China plus Sixteen” outbreak – establishing the institutions of
the framework
How important Central and Eastern Europe (CEE) has become
for China – with no difference towards EU and no EU member states
among them - became clear when China initiated project of Cooperation
between China and Central and Eastern European Countries (Albania,
Bosnia and Herzegovina, Bulgaria, Croatia, the Czech Republic,
Estonia, Hungary, Latvia, Lithuania, Macedonia, Montenegro, Poland,
Romania, Serbia, Slovakia and Slovenia) in April 2012, when the first
meeting of the prime ministers of China and CEE countries was held
in Warsaw. At the occasion Premier Wen Jiabao announced the 12
measures32“on promoting the friendship and cooperation with CEE
countries”.
It is very interesting that in Chinese press analyses the fact that
„Central and Eastern European countries were among the first to
recognize the People’s Republic of China” came out. Also, it was often
pointed that “compared to their strong political relationship, the
cooperation between China and Central and Eastern Europe needs to
be improved“33 and elaborated with the date of the 16 CEE countries
that have a population of 123 million and an area of over 1.3 million
square kilometres, but their total trade volume with China is less that of
Italy and that Chinese investment in those countries is smaller than in
Sweden and the total investments of the 16 central and eastern European
countries in China is less than Austria’s one alone34. On the website of
the Chinese foreign ministry the Bucharest summit was described as a
strong sign of improving relations between China and the region.
Chinese experts explored that countries in the region crave for
foreign investment as their economies during the transition decades
became highly dependent on the Western Europe economies as the
leading and strategic industries of Central and Eastern Europe became
under foreign control and dependent on foreign capital inflows. Since
the outbreak of the euro zone debt crisis and prolonged recession, it
32 http://www.fmprc.gov.cn/eng/zxxx/t928567.htm
33 Global Times : ”China eyes closer ties with Central-Eastern Europe”, September 6, 2012,
Available at: http://www.globaltimes.cn/content/731653.shtml.
34 Wang, W. “Tapping into each other’s strength“, China Daily European Weekly, p. 9. 4 July,
2014.
36
Dragana Mitrović
China in the Western East – and Beyond:Politics and Economics
of the China Plus Sixteen Cooperation Framework
became necessary for the CEE region countries to attract foreign
capital from outside Europe as their economies suffered from limited
bank liquidity, drop in investment, consumption and credit crunch.
During the crisis, investment in Central and Eastern Europe was halved
from $152 billion to $75 billion, according to the Vienna Institute
for International Economic Studies35. On the contrary, cooperation
between China and these countries has intensified and deepened since
the outbreak of the global economic crisis, as bilateral trade grew at
an average rate of 30%. In 2001, bilateral trade was only $4.3 billion.
In 2011, China’s trade with Romania alone surpassed that figure. That
same year, China’s trade with the 16 countries amounted to nearly
$53 billion. Two-way investment also has accelerated, and Chinese
enterprises have invested in industries such as chemical, machinery,
household appliances, telecommunications, automotive, new energy
fields, agriculture, finance, R&D. Their contribution to local economic
growth and employment has been very positive, strengthened by
realization of the joint infrastructure construction projects. Also, with
the rising technological power of Chinese corporations, CEE countries
were looking for more Chinese investment to make their economies
more competitive.
The first measure, announced by Prime Minister Wen was to establish
a Secretariat for the cooperation between China and CEE countries.
The Secretariat is established within the Ministry of Foreign Affairs
of China as a Chinese agency, responsible for communicating and
coordinating China-CEE cooperation matters. The 16 CEE countries
have designated national coordinators or specialized agencies to work
with the Secretariat. Through internal and external coordination,
the Secretariat should work to facilitate the implementation of the
outcomes of meetings between leaders of China and the central and
east European countries, plan for cooperation initiatives in accordance
with the latest development and serve as a bond of cooperation through
resources mobilization and integration.
The second measure includes opening the special credit line
worth US$10 billion, a certain proportion of which (some 30%) will
be preferential funding. The whole amount should be used for the
investment cooperation and sixteen countries should apply for the
funds by submitting project proposals in such areas as infrastructure,
high and new technologies, and green economy. The project application
35 Ibidem.
37
should be sent to the National Development Bank of China, Export
and Import Bank of China, Industrial and Commercial Bank of China,
Construction Bank of China, Bank of China or China Citic Bank.
The third measure consists of setting up an investment cooperation
fund between China and 16 countries with the goal of raising US$500
million in the first stage. The fourth measure that Premier Wen proposed
was for China to send trade and investment promotion missions to 16
CEE countries with purpose to take concrete steps to move forward
bilateral economic cooperation. The target for two-way trade was set
to reach US$100 billion by 2015.
China promised to encourage Chinese enterprises to cooperate with
16 countries to establish one economic and technological zone in each
country in the next five years. Also, it would continue to encourage and
support more Chinese enterprises to take part in the development of
existing economic and technological zones in these countries as the fifth
measure. The sixth measure was in the area of financial cooperation
where the readiness was expressed for currency swap, local currency
settlement for cross-border trade, and establishment of bank branches
in each other’s countries, so that it will improve support and services
for practical cooperation in this area. The seventh measure means
establishment of an expert advisory committee on the construction of
transportation network between China and the sixteen CEE countries,
where the Ministry of Commerce of China as the coordinator. The CEE
countries would participate if interested in cooperating with China
in eventual building of regional highway or railway demonstration
networks either through joint ventures, joint contracting or other
frameworks.
Proposal of a forum on cultural cooperation between China and
central and eastern European countries in 2013 in China and, within
this context, hold regular high-level and expert meetings on culture,
cultural festivals and similar activities was the eight proposed measure.
The next measure was China’s offer to provide 5,000 scholarships to
the 16 countries in the next five years, expend support the Confucius
Institutes and Confucius Classrooms program in them, invite 1,000
students from the relevant countries to study the Chinese language in
China in the next five years, boost inter-university exchanges and joint
academic research, and send 1,000 students and scholars from China to
the 16 CEE countries in the next five years. The Ministry of Education
38
Dragana Mitrović
China in the Western East – and Beyond:Politics and Economics
of the China Plus Sixteen Cooperation Framework
of China plans to host an education policy dialogue with 16 countries
relevant institutions in 2013.
The tenth measure was a proposal for establishing a tourism
promotion alliance between China and 16 CEE countries, which
would be coordinated by China Tourism Administration and open to
participation by civil aviation authorities, travel agencies and airline
companies of the two sides. The purpose of this was to improve mutual
business promotion and joint tourist destination development, and
explore the possibility of opening more direct flights between China
and the 16 countries. China Tourism Administration co-organized a
tourism products promotion for China and 16 countries during the
China International Tourism Mart that was held in Shanghai in the
autumn of 2012, as a prompt implementation of that scheme.
Establishment of a research fund that would be used by researchers
on relations between China and 16 CEE countries, that would be
financed by China with RMB 2 million (247,184 EUR) every year and
used to support academic exchanges between research institutes and
scholars of the two sides. The final proposed measure was China’s plan
to organize and host the first forum of young political leaders of China
and the 16 CEE countries in 2013 with the idea to improve mutual
understanding and friendship.
On August 14, 2012, China-Central and Eastern Europe Cooperation
Secretariat held a forum on localities and businesses participating
in China-Central and Eastern Europe cooperation in Beijing. Vice
Foreign Minister and Secretary-general of the Secretariat Song Tao
delivered a keynote speech to the forum, that was attended by officials
from foreign affairs offices of 11 Chinese provinces, autonomous
regions and municipalities (Tianjin, Inner Mongolia, Liaoning,
Jiangsu, Zhejiang, Fujian, Shandong, Hubei, Guangdong, Chongqing
and Sichuan), representatives from dozens of Chinese enterprises and
financial institutions and envoys and diplomats of 16 CEE countries.
On September 6, 2012, the Inaugural Conference of ChinaCentral and Eastern European (CEE) Cooperation Secretariat and
the First National Coordinators’ Meeting were held in Beijing with
the participation of representatives from Chinese members of the
Secretariat and national coordinators, representatives and diplomatic
envoys of 16 CEE countries36. Following the inaugural ceremony for
36 http://www.fmprc.gov.cn/eng/zxxx/t969490.htm
39
the establishment of the Secretariat, Song Tao, Vice Foreign Minister
and Secretary-General of the Secretariat, chaired the first national
coordinators’ meeting. Song stressed that the meeting between the
leaders of China and CEE countries in Warsaw in April 2012 created a
new landscape for the development of state-to-state relations between
China and CEE countries and that “pragmatic cooperation between
China and the 16 CEE countries in economy, culture, education,
tourism and other fields is moving forward steadily” as China’s
agencies, departments and local regions were fully mobilized to
participate in China-CEE cooperation. The representatives from the
Chinese Ministry of Commerce, Ministry of Agriculture, National
Tourism Administration, Ministry of Education, Ministry of Culture,
International Department of the CPC Central Committee, Ministry
of Foreign Affairs and other member agencies of the Secretariat spoke
respectively at the meeting, reviewed the progress made by China in
implementing the 12 measures, and introduced measures and plans for
the next-phase cooperation.
The holding of the inaugural meeting of the Secretariat and the First
National Coordinators’ Meeting also marked the establishment of a
network at the working level for the cooperation. Very important point
was given by Song Tao who emphasized that China-CEE cooperation
is an important part of China-Europe relations as the increasing
pragmatic cooperation between China and CEE countries will help to
improve the size and quality of China-Europe cooperation, will benefit
the development of China-Europe relations in a more comprehensive
and balanced manner, and will help Europe to overcome the current
difficulties37. China-Central and Eastern Europe Cooperation
Secretariat held its annual meeting in December 2012, headed by Vice
Foreign Minister and Secretary-general of the Secretariat Song Tao38.
Cooperation between China and countries from Central and
Eastern Europe is going to gain more and more importance. The value
of trade between them and China, that was only 4.3 billion US$ in
2001, reached 52.9 billion US$ in 2011, with the annual growth rate of
27.6%. After the global economic crisis outbreak average growth rate
of the Chinese import from those countries has been 30%39. Double
37 Ibid.
38 http://www.fmprc.gov.cn/eng/zxxx/t1000583.shtml
39 Chinese ambassador in Belgrade, H.E. Zhang Wanxue in an article printed in “Politika”
Belgrade daily. Available (in Serbian) at: http://www.politika.rs/rubrike/Svet/Kina-
40
Dragana Mitrović
China in the Western East – and Beyond:Politics and Economics
of the China Plus Sixteen Cooperation Framework
flow investments became more frequent, investments and other
engagements of Chinese enterprises have been numerous, especially
in area infrastructure, chemistry, machinery, home appliances,
telecommunications, automobiles, green energy. Cooperation in
the field of agriculture, finance, science and technology has been
expending.
In November 2013 Chinese Premier Li Keqiang, at the China-CEE
prime ministers meeting in Bucharest announced 12 proposals to push
forward cooperation between China and CEE countries. Key areas
of cooperation included projects in economy, culture and education
and some developments already happened, like a forum on education
policies in China-Central and Eastern European countries in Tianjin
in September 201440. Chinese Premier at Bucharest summit that
China’s development could not be separated from cooperation with
other countries, and that the world’s prosperity and stability needed a
growing and advancing China. He called for “all-dimensional, wideranging and multilevel cooperation” between CEE countries and
China. Li stressed that China and CEE countries were emerging-market
economies at similar phases of development, and they were all faced
with the urgent task of restructuring their economies, innovating, and
promoting competitiveness. For him that creates many opportunities
for deepening practical cooperation and achieving win-win common
development for “1+16”.
He proposed that China and CEE countries dedicate the 2014 year
to promote trade and investment and work together to double their
trade in five years and announced that China would host a series of
programs, including a roundtable meeting of Chinese and CEE trade
ministers and an exhibition of CEE products, to accelerate the growth of
China-CEE trade. He also announced that China was ready to increase
the imports of competitive CEE products and encourage more Chinese
tourists to visit CEE countries.
Li also called for the launching of a number of large infrastructure
projects, proposing to combine China’s capable and advanced industry
of equipment manufacturing and the needs of CEE countries for
unapredjuje-saradnju-sa-evropskim-zemljama.lt.html.
40 The forum involved more than a 160 participants from China and 16 Central and Eastern
European (CEE) countries, including education ministers, and presidents of universities.
They discussed experiences with different education reforms, education and job market,
and faculty’s rotation and students’ exchange activities.
41
infrastructure improvement. He pointed that priority areas included
high-speed and regular railway, nuclear and other forms of power,
road, port and telecommunications.
Chinese Premier also suggested that China and CEE countries
should make full use of relevant financing mechanisms and encourage
their financial institutions to set up branches on each other’s territories
and enlarge the scale of currency swap and local currency settlement.
Additionally, Li proposed that China and CEE countries boost
corporate investment cooperation, work out a framework agreement
on industrial investment, and upgrade cooperation between Chinese
and CEE small- and medium-sized enterprises.
He also urged the governments, enterprises, think tanks and
media of China and CEE countries to play their unique roles and
work together to push China-CEE cooperation further forward more
rapidly and steadily. The Silk Road Economic Belt and the 21st Century
Maritime Silk Road were proposed by Chinese leaders at the beginning
of 2014 year as strategies to create China-Europe cooperation in foreign
trade, investments and tourism. The proposed land-based Silk Road
Economic Belt begins in Xi’an, runs through Central Asia to Eastern
Europe, and than reaches Western Europe. While the sea-based
Maritime Silk Road begins in Quanzhou, heads south to the Malacca
Strait, across Africa and then connects to Europe. Chinese Vice-Premier
Zhang Gaoli connected Central and Eastern European countries with
the initiative in Prague, in August 2014, when he attended the Fifth
China Investment Forum, saying that they were “well placed to achieve
mutual benefits with China from cooperation in trade, investment and
infrastructure building”41.
There is an understanding among the Chinese scholars that countries
from the eastern and central European region - like China – has been
currently going through a phase of economic transition and consolidation
and that the dialogue and cooperation between the two is driven by
shared interests and common issues. Additionally, China and Eastern
European countries have 37 pairs of sister provinces and states, and 58
pairs of sister cities that are perhaps, the most convenient way to enter
Chinese market. According to Chinese media, China also dispatched to
the CEE countries a trade and investment promotion mission, set up a
41 “Linking with Central and Eastern Europe”, China Daily, September 8, 2014
42
Dragana Mitrović
China in the Western East – and Beyond:Politics and Economics
of the China Plus Sixteen Cooperation Framework
joint transportation network construction expert advisory committee
and created a tourism alliance and a research fund.
Several symposiums and round tables were organized by the relevant
Chinese research institutions with participation of the CEE scholars,
including the organization of the First Symposium of the Think-Tanks
from CEE countries and China in Beijing, in 201342.
Cultural exchanges have been an important driving force of bilateral
relations in the past. In CEE countries, more and more people are
learning Chinese - Confucius Institutes and Confucius Classrooms
have grown to more than 58 in the region. In Serbia, there are three
Confucius institutes and Chinese was introduced as foreign languages
in numerous high schools that applied for that scheme, supported by
Chinese state.
Despite all the economic potential benefits, Chinese strong initiative
towards Central and Eastern Europe was viewed with concern in certain
offices in Brussels. EU Trade Commissioner, Karel de Gucht, even said
during the EU-China summit in November 2013 that Beijing was
playing one side off against one another in Europe. Some politicians
and experts spoke of China building “a new Great Wall” across EU area
and trying to take The Balkan states away from its EU part. Earlier that
year, “Financial Times” quoted an unnamed European diplomat as
saying that the business forum in Bucharest was part of China’s strategy
“to divide and conquer” Europe.
4. Strategic partner – Serbia
Under the given framework, Serbia, that first signed agreement
on strategic partnership with China in 200943, proved to be especially
active and attractive at the same time, as this strategically positions state
already attracted more over 1.6 billion of the preferential funding (one
project financed this way is bridge on the Danube “Zemun-Borca” and
the other is two-phased upgrading and expanding of the two blocks of
“Kostolac B” thermo power plant, both financed up to 85% by China
42 The second one was organized in Bled, Slovenia in September 2014.
43 Two years later, Poland managed to establish such level of official relationship with PRC as
President Hu Jintao and Polish President Bronislaw Komorowski signed a joint statement
extending bilateral relations to a level of strategic partnership in Beijing, on December 20,
2011.
43
Exim Bank with 1.3 billion US$) and additional 303 million US$ for
the projects of two parts of the planned high-way construction.
Beyond financing, Chinese companies are involved in construction
of the high-way parts - Shandong High-Speed company that is
engaged in constructing two parts of the high ways on the Corridor
XI (Obrenovac-Ub and Lajkovac-Ljig) long 50 km was registered in
Serbia in 2013. Again, Serbian companies as sub-builders are involved
in works to 49%. The value of the two parts is about 340 US$, which
will be financed by the Serbian state investment of 35 US$ millions
and by loan given by EXIM Bank of China, of 301 US$ million (grace
period is five years, payment period twenty years, with the fixed rate
of 2.5%). Due to the overburden dept position of Serbia, another ways
were introduced for the other promising engagements of the Chinese
companies regarding construction of the parts of the high way on
the Corridor XI, Preljine-Požega and Beograd-Obrenovac would be
financed thru concession. It is interesting that Chinese partners were
offering concession financing in the Corridor XI project, but previous
Serbian governments insisted on other ways of financing it and choosing
the companies to get the job thru tender procedures that later proved to
be highly dubious and inefficient.
The first two projects got high level political support, since Wu
Banguo’s visit to Serbia in 2010. “Serbia is an important country in
central and eastern region of Europe and one of the strategic partners
of China. Traditional friendship has been deepening between the
two countries. Contacts on political level are getting closer, economic
cooperation has been developing and project of constructing the bridge
over Danube and revitalization of TE Kostolac thermo-power station
became excellent models for development of cooperation with China in
the sense of performing and managing such huge and technologically
advanced projects in Central and Eastern Europe”44.
For the domestic economies of the 16 CEE countries such
investments are most welcome as, like in Serbian case, twenty tree years
after the dismemberment of SFR Yugoslavia, nowadays Serbia has GDP
value of some 70% of the one she had in 1989 and in spite of some 8
billion US$ worth donations since 2001 and foreign direct investments
44 http://www.fmprc.gov.cn/eng/zxxx/t1000583.shtml
44
Dragana Mitrović
China in the Western East – and Beyond:Politics and Economics
of the China Plus Sixteen Cooperation Framework
inflow in the last thirteen years worth more than EUR 16 billion45, the
centrally positioned South-Eastern European country is burdened
with old, weak and backward transport and energy infrastructure in
which the most recent projects were realized 30 or 40 years ago. Every
investment, especially one under favourable financial conditions and
no political ones, is very good news for Serbia’s economic and general
ambient. Additionally, strategically speaking, it is good for Serbia to
widen its political and geographic spectre of big investors, so that it is
not too dependent on EU or any other centre of power.
By the end of 2012 Serbian Minister of Natural Resources, Mining
and Spatial Planning went out publicly with another potential giant
project - possible construction of the waterway Danube-MoravaVardar, which would link Serbia, Macedonia and Greece with Central
Europe and through the Danube countries with the rest of the world.
According to Minister Bacevic46 implementation of this historically
significant project next waterway connecting these countries, creating
the conditions for the development of Serbia in the field of transport
and energy, with respect to the given space opens up the possibility
for the construction of five to seven power plants total capacity of 350400 megawatts. The construction of irrigation systems on the banks
of the Morava River would improve conditions for development of
agriculture and the economy as a whole. On the banks of the river lays
the densest concentration of population and settlements in Serbia, and
therefore the importance of the infrastructure would be multisided.
As potential partners Chinese and global giant in construction
engineering, China Gezhouba Group Corporation was mentioned, as
well as China International Water and Electric Corp47. On the other
hand, this project was often criticized in Serbian media and among
experts and opposition politicians as highly unrealistic.
On February 21 2013, Serbian media reported about announcement
given by the representatives of the Economic Department of the
Chinese Embassy in Belgrade and Serbian Minister of Transport Mr.
Milutin Mrkonjic that the Chinese Embassy in Budapest launched
an initiative for the construction of high-speed rail on Corridor 10
45 http://www.b92.net/eng/news/business-article.php?yyyy=2013&mm=02&dd=04&nav_
id=84516/
46 Since November 2014 Ambassador of Serbia to Beijing.
47 http://www.mprrpp.gov.rs/en/meeting-with-representatives-of-chinese-companies-2/
45
between Belgrade and Budapest for trains whose speed exceeds 300
km/h. The total value of the investment would go approximately up
to EUR 2 billion, early estimates show as this, two decades ago, EC
top priority project, would be built in almost perfect conditions due to
the extremely favourable terrain. According to the same sources, the
Chinese initiative for the construction of high-speed rail was already
discussed at the session of the joint Hungary-Serbia commission
held December 2012, and it was included in the proceedings on the
commission’s work. Talks on the model and the ownership structure
of the project ought to be conducted. Chinese investment would come
from the Chinese Development Fund aimed at investments within the
framework “16+1” investment fund. Chinese officials suggested that
loans should be ensured and this matter should be discussed by the
governments of Serbia and Hungary within the framework. According
to analyses came out so far and the data procured from economic and
expert teams, the railway would pay off and its construction would be
commercially justified since the flow of passengers, goods and capital
between the two countries has been constantly increasing.
In November 2013 Chinese government announced intention to
establish a special fund of 25 million EUR for supporting cooperation
with Serbia in mining sector, as both side expected broadening of
cooperation in the near future. According to the Ministry of Commerce
of the PR China trade between Serbia and China grew by 18.7% in 2013,
thanks to newly established Chinese companies in Serbia. In 2013,
Serbia-China trade exchange exceeded 1.1 billion dollars, according to
the Serbian Chamber of Commerce data. Chinese side lately expressed
interest in importing meat and meat based products, fruit and other
staple products from Serbia.
In January 2014 Chinese electric corporation “Sinomach - Cneec
- Cneetch“ opened its European office in Ub, Serbia. The company
announced its interest to invest 1.3 billion EUR into several big energy
sector projects in Serbia, such as thermo power station Kolubara B,
surface mine „Radljevo“ of the Kolubara mining corporation, hydro
power station Djerdap 3 and three smaller hydro power stations.
During the visit of the Prime Minister of the Republic of Serbia
Aleksandar Vucic to People’s Republic of China from 9 to 12 September
2014, he was in Beijing and Tianjin, where he participated in the World
Economic Forum and met with Premier of the State Council of the
46
Dragana Mitrović
China in the Western East – and Beyond:Politics and Economics
of the China Plus Sixteen Cooperation Framework
People’s Republic of China, Li Keqiang. The two Prime Ministers
agreed on Serbian organization of the third China Plus Sixteen summit
in December 2014., emphasized mutual willingness to further deepen
strategic partnership and within it implementation of major projects
between the two countries. In addition to the completion of the project
of the bridge Zemun-Borca, special emphasis was put on the project of
modernization of the railway Belgrade-Budapest48 that was announced
during the previous summit in Bucharest and worked on the project’s
preparation in the meanwhile. When visiting Belgrade in December
16th 2014, Li Keqiang will be the first Chinese Prime Minister to do so
after more than three decades. It is planned that he open bridge ZemunBorca, built by CRBC and Serbian sub-builder “Ratko Mitrovic” and
that two sides, together with the third one – Hungarian, sign a memo
on another, even bigger project on modernization of the BelgradeBudapest railways, that would push regional economic growth, too.
Also, Chinese side might announce intention to build a cultural
centre in Belgrade, on the spot of the former Chinese Embassy building
that was demolished in NATO bombing of the FR of Yugoslavia, the
third cultural center that People’s Republic of China in Europe.
5. Conclusion
The ongoing world economic crisis has sharpened some of the
existing problem in the relationship between EU and China, but
also urged solutions for their resolution. On the other hand, growing
economic presence of China in the economies of the new EU members
Bulgaria and Romania, and especially Serbia, does not represent
some special behaviour of China, but entirely fits into its emphasized
engagement in the EU and Europe in totality.
Stronger Chinese engagements could be understood as a good
student behaviour, who understood the lesson that says that gaining
stronger influence on the EU and in its individual member states
comes with more significant economic presence within, and not only
as trade partner and FDI destination for particular corporations from
particular EU countries.
48 http://www.beijing.mfa.gov.rs/index.php
47
Repeating the same pattern that China has used to strengthen its
impact in near neighbourhood, in Africa and Latin America, and even
with the USA, China has moved towards multiplying and strengthening
its presence in Europe. Since the outbreak of the global crisis especially
Mediterranean and Eastern and South European countries has become
very attractive for Chinese business community, supported by their
government.
Almost all investors noticed from both sides expressed willingness
of Chinese and Eastern, Central and South Eastern European countries
that has led to competition among them as destinations for Chinese
investments and between them and traditional Chinese business
partners among the EU countries. Advantages of the new EU member
and “hopeful members to be” are expected high growth rates, relatively
low wages and skilful work force, closeness to or the very EU market with
“made in EU” branding, as well as horizontally connected production.
Also, not less important cooperation with them means absence of the
human rights topic and other “judging on” positioning, including one
on the openness of the Chinese market.
Additionally, central and South-East European countries as former
communist countries have history in doing business with China, even
exporting technology and experiences of their first steps in transition
during the first phase of the Chinese reform and opening up project.
Especially after the EMU crises they rediscovered China as promising
investor and reliable partner. Also, they have relatively cheap and skilful
work force and do not press China with ideological issues. Serbia has
been doing the same thing as Germany and Italy and others have
been - when their partners within EU are getting incapable to provide
recovery and growth - they are turning towards Russia and China. Of
course, in geopolitical game, growing influence of China or Russia
means lessening the dominance of the EU and USA in the region, but
that is good for Serbia and its even good for the EU, as an important
part of Europe is being helped to stabilize and economically revitalize.
48
Dragana Mitrović
China in the Western East – and Beyond:Politics and Economics
of the China Plus Sixteen Cooperation Framework
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50
Institute for Political Studies
UDC 329.78(497.15)”1878/1914”
Manuscript received: 03.09.2014.
Accepted for publishing: 23.09.2014.
Original scientific paper
Serbian Political Thought
No. 2/2014,
Year Vl, Vol. 10
pp. 51-67
Radoslav Gaćinović1
Institute for political studies, Belgrade
European Concept of the Young Bosnia
Movement
Giving up freedom is giving up everything that
is human: dignity, human rights, even one’s
own responsibilities.
Jean-Jacques Rousseau
Abstract
This paper is also an attempt to light up dimensions of depth of the political,
social and economic factors in Bosnia and Herzegovina to the extent they encouraged members of the Young Bosnia movement (Mlada Bosna) to a decisive
action. And indeed, to which extent did the assassination result from the social
and political circumstances which were prevailing in a country where members
of Young Bosnia were born and raised. The Young Bosnia members found their
inspiration for the revolutionary action in similar youth organizations formed
amongst the unfree nations of Europe since 1831. Through their activities they
persistently propagated: the philosophy of nationalism and democratic political doctrines, building of national consciousness, creation of cult of national
energy, work on the creation of modern national culture based on believes that
national culture cannot be without national society, and national society cannot
be without national state.
Keywords: Mlada Bosna (Young Bosnia), liberation movements, organization, Austria-Hungary.
Austria-Hungary occupied Bosnia and Herzegovina based on
the Article 25 of the Berlin Congress from 1878 for a certain period
of time i.e. for 30 years. During the occupation, Austria-Hungary at
1 Research fellow
gacinovicr@gmail.com
51
the same time was spreading total propaganda in order to convince
the Great Powers to change the time-limited mandate for occupation
into a permanent occupation. Austria-Hungary and its allies believed
that the occupation was founded on the international law and then,
at the same time, tried to convince the global public opinion that it
had been carried out on a state and legal basis and internal basis as
well. According to the first interpretation, all legal measures of the
occupation authority were temporary, whereas according to the
second one, they were permanent. Behind the issue of the legal status
of Bosnia lied the question of who the real master in those provinces
was. According to the 1879 Convention, the Sultan’s name and Turkish
flags were just a symbol of Turkish power, however everything else
carried the markings of Austro-Hungarian permanent presence in the
provinces. The Serbian School of Law always stood by the conclusion
that the Austro-Hungarian occupation of Bosnia and Herzegovina had
international legal, and not state legal characteristic, i.e. that it was an
international and open rather than internal and closed issue. Following
its arrival to the territory of Bosnia and Herzegovina, through its
actions the Austro-Hungarian Monarchy presented itself as a real
occupying power and thus caused the revolt of the people, in particular
of the progressive intelligentsia from that region. Due to random and
brutal violence, the citizens of Bosnia and Herzegovina established
illegal cultural institutions and political organizations, led by the Young
Bosnia movement whose members carried out an assassination of the
Austro-Hungarian heir to the throne Franz Ferdinand. Many Bosnian
and Herzegovinian youngsters were in the front rows of the Young
Bosnia movement, as a general movement of the revolutionary youth.
Bogdan Žerajić and Vladimir Gaćinović were role models to the young
people, the former one with his personal sacrifice, and the latter one
with his revolutionary propaganda and action (Slijepčević 1929: 209;
Trišić 1935; Bogićević 1954: 301-303).
Near the end of the 19th century, only 30 Bosnians and Herzegovinians
had academic background (Stojanović 1929). At the beginning of the
20th century, a new generation of intellectuals appeared in Bosnia and
Herzegovina. Historical circumstances led to a very slow development
of the Bosnian and Herzegovinian society compared to other Europe
countries. Austro-Hungarian authorities systematically supported
the backwardness and did not pay attention to mass education. In
1910, after thirty two years of the Vienna administration, 87% of the
52
Radoslav Gaćinović
European Concept of the Young Bosnia Movement
population were illiterate and just 5 secondary schools for somewhat
less than 2 million people in Bosnia and Herzegovina. Such an attitude
of the Monarchy towards the citizens additionally motivated young
Bosnian and Herzegovinian revolutionariesto fight for existence and
survival, for education and cultural development of the young people
(Gaćinović 2010: 446).
Charity educational association Prosvjeta immediately upon its
establishment in 1902 started to give scholarships to the poor yet
excellent pupils. This new intelligentsia had much more different political
motives from the previous generations. Studying at world-renowned
universities and working with the world’s leading theoreticians of the
academic institutions and universities of that time, it gained additional
motivation to fight until the final liberation of the suffering people of
their homeland2. Violent politics of Austro-Hungary and Germany
at that time, with its particular, inconsistent humanism, is only a
confirmation that an attack on a human being was a universal reality
back then, especially on the nations that they wanted to nullify, and
yet they were not successful. Benjamin Kallay invested huge efforts in
the forming of Bosnian nation in Bosnia and Herzegovina, and in the
beginning of the 20th century he tried to declare the Bosnian language
in that region, in times when the Austro-Hungarian Monarchy was at
the peak of its economic, political and military power, but he did not
succeed. He did not succeed because nations can’t disappear, because
the main democratic principles rest on nations, that a human being has
the natural right to freedom. Even though the Viennese government
officially stated that,after the annexation of Bosnia and Herzegovina,
it was “territorially saturated”,it was just the first stage of the AustroHungarian advancement to Thessaloniki and Germany to the east.In
the next stage, war against Serbia and its annexation was planned, or
division of Serbia between Austria, Bulgaria and Romania.
2 It was only by the establishment of Prosvjeta in 1902 that the situation gradually
changed. Prosvjeta had the greatest influence on creation of the modern Serbian
intelligentsia in BiH at the beginning of the 20th century. It was a broad organization
which in 1911 had a network of 79 sub-boards, 266 commissaries and a few thousand
helping members. Until the beginning of the Great War, this educational organization
schooled 127 students at universities around the world and 220 secondary school
students (Ekmečić 1996: 32-35).
53
Roots of the Young Bosnia Youth Movement Origins
The term ‘’Young Bosnia’’ was first used by Petar Kočić in the
‘’Оtadžbina’’ (Homeland) newspaper in 1907, and then by Vladimir
Gaćinović in the Almanach of Prosvjeta in 1910 in the article called
‘Young Bosnia’’. Vladimir Gaćinović, as a founder of the youth liberation
organisation ‘’Young Bosnia,’’ also became its conceptual leader. He
had the highest credits for its popularization among members of all
the nations of Bosnia and Herzegovina. Young Bosnia fought for the
liberation of Bosnia and Herzegovina and unification of all the Slavic
peoples. Its members fought against the Austro-Hungarian Monarchy
as an occupier, which was by no means neither legal nor legitimate. It
was imposed forcibly, it was not chosen by the people of Bosnia and
Herzegovina. The Austro-Hungarian Monarchy, after the occupation
and annexation of Bosnia and Herzegovina in 1908, more drastically
than during the Ottoman Empire, violated human rights and freedoms
of citizens. For all its citizens, days filled with the reign of terror and
uncertainty began. In difficult circumstances that prevailed in Bosnia
and Herzegovina after the annexation in 1908, its nations were forced
to lose their identity and dignity under pressure. Standing up to the
random violance, the Young Bosnia members, through their activities,
persistently propagated: the philosophy of nationalism and democratic
political doctrines, building of national consciousness, creation of cult
of national energy, work on the creation of modern national culture
based on believes that national culture cannot be without national
society, and national society cannot be without national state.
Events that followed after the Russian Revolution in 1905
encouraged the interests amongst the Young Bosnia members not only
in the solution of an agrarian issue but also in the Russian literature
and history. The entire pages of Chernyshevsky’s book What is to be
done? were being transcribed and passed on from hand to hand. Apart
from Chernyshevsky, they were reading Bakunin, Herzen, Dostojevsky,
in particular his novel Crime and punishment, and Maxim Gorky
(Parežanin 1927). They dedicated great attention to the Italian and
German movements for the national liberation. For the Young Bosnia
members, Giuseppe Mazzini was „a real and great man” (Ibid.). Italian
revolutionary tradition from the period of risorgimento caught strong
roots in Herzegovina. Both in the uprising in 1861 and in 1875–1878,
the rebel serfs kept connections with Garibaldi followers. In the 2nd
54
Radoslav Gaćinović
European Concept of the Young Bosnia Movement
uprising, even volunteer fighters from Italy participated. When he was
just a fifteen-year-old young boy, Vladimir Gaćinović called himself a
„Garibaldinian” (Gaćinović 1956: 185) and studied literature from the
period of the national unification of Italy. Even the name Young Bosnia
was based upon Mazzini’s Young Italy. Mazzini’s ideas that the youth
must be the main power in the liberation of its homeland, that it has
to create people of new caliber, ready for the biggest sacrifices, had a
significant influence on the Young Bosnia members in the first years
of their work and programme creation. During the trial, in October
1914, Gavrilo Princip and Nedeljko Čabrinović referred a few times
to Mazzini as an example of how liberation and unification should be
fought for (Bogićević 1954: 32; 63; 84).
The Young Bosnia members knew their people were enslaved,
however they refused to be subdued no matter how strong the AustroHungarian Monarchy was. The assassination of the Heir to the
Throne Franz Ferdinand in1914 in Sarajevo was treated at that time
as a murder of any member of the occupying army. It must be pointed
out that most countries did not recognise the annexation of Bosnia
and Herzegovina as it was carried out against the will of the citizens
of Bosnia and Herzegovina and the decisions of the Berlin Congress.
After the occupation and annexation, Austria-Hungary treated Bosnia
and Herzegovina as its ethnic territory, on one side, and its citizens as
servants, on the other. It carried out terror on everyone: Serbs, Croatians
and Muslims, so the members of Young Bosnia were representatives of
all nations. Many in the world thought that the Sarajevo assassination
was an act of the revolutionary resistance toward the occupier,
remembering the Old Testament, which mentions the cases of Aod and
Jael, and the European tradition of tyrannicide, based on the theories of
classic republicanism of the ancient Greece and Rome.
Murder of a tyrant in the ancient Greece and Rome was celebrated
as the noblest human act, which was spoken of by Aristoteles, Platon,
Marcus Tullius Cicero, Cornelius Tacitus…Catholic encyclopedia
defines tyrannicide as a murder of a tyrant by an act of an individual for
the common good (The Catholic Encyclopaedia: 108). Many Serbian
poets in the first half of the 19th century had similar opinion. Sima
Milutinović Sarajlija, in his utopias, thought that a prince (knjaz) was
just the first chosen officer, and if he would break the Constitution,
he was to be harshly punished by the Parliament – to be burried alive
(Nedić 1959: 176).
55
Scholars and famous theoreticians of that time thought that
sovereign power must always belong to people, and people transfer it to
the rulers through an agreement that they conclude with them. People
can never give up sovereign power in favor of the ruler–people entrust
its performing to the ruler as long as the ruler does it in a good manner.
The people, therefore, always keep the right to replace the ruler.
John Locke was the first one who formulated the theory of resistance
more thorougly. In his work on the civil government, Two Treaties of
Civil Government, he gave the form for many revolutions in the world
later on. He correlated his theory on the right to rebellion with the
learning of the natural law on the social contract and gave the following
definition: „Whoever uses force without right, puts himself in the state
of war with those against whom he uses it, and in that state all former
ties are cancelled, all rights cease and everyone has a right to defend
himself and resist the aggressor” (Locke 1988: II; Ch. XIX).
The Young Bosnia members, amongst other things, built their
programme on the theory of national sovereignty which was
systematically exposed for the first time by Johannes Althusiusin his
work Politica methodice digesta at que exemplis sacris et profanes
illustrate, because they thought that sovereign power belonged only
to people. Taking into account the mentioned theories of tyrannicide,
the Young Bosnia members thought that Franz Ferdinand was the
biggest tyrant – tyrant occupier. For them and the peoples of Bosnia
and Herzegovina, by his evil, he surpassed all the tyrants chosen by
the people and that is why they were convinced they had the right to
remove him. The people therefore thought that they had a multiple
right to remove Franz Ferdinand as a tyrant occupier and tyrant who
unlawfully and against the will of citizens carried out the annexation
of Bosnia and Herzegovina. If the Young Bosnia members were not
free from the outer influence, then their ideas may be correlated with
the aspirations of Mazzini’s Young Italy,3 difference being that ideas of
3 Guglielmo Oberdan, an Italian irredentist of the Slovenian origin (1858–1882), in
the summer of 1878, stood up against the Austro-Hungarian occupation of Bosnia
and Herzegovina and deserted the army in order to avoid being sent to Bosnia and
Herzegovina. He fled to Rome and made contacts with the circles that fought for the
liberation of the Trieste region from Austria-Hungary, and for its accession to Italy. When
in 1882 a celebration marking 500 years anniversary of the Trieste accession to Austria
was organized, which was attended by the Emperor Franz Joseph, Oberdan threw a bomb
at him but the assassination failed. Sentenced to death for treason, Oberdan was hanged
on 20 December 1882, to be declared a martyr for the freedom and a popular hero later
on. City squares and streets have his name, and at the 100 years anniversary since his
56
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European Concept of the Young Bosnia Movement
the Young Bosnia members were the result of the living conditions in
Bosnia and Herzegovina, of the tradition of Kosovo myth at times of
great imperialistic conflicts that shook the world in the beginning of
the 20th century. Young Bosnia members thoroughly studied all the
revolutionary movements in the world, especially the messages of the
American Revolution. One of the important messages of the American
Revolution is: „It is the sacred right of an individual, group or nation to,
even with weapons in their hands, stand up against foreign occupation
or non-democratic rule.” And the other message that the Young
Bosnia members accepted was: „The Аmerican Revolution was, in the
beginning, a form of rebellious democracy, that soon and successfully
turned into constitutional democracy, supported by appropriate
democratic institutions” (Ilić 2013). It was these two principles of the
American Revolution that Young Bosnia members advocated for.
At the time of the live revolutionary activity in Europe, especially
in those countries that were under the occupation by the AustroHungarian Monarchy, Vladimir Gaćinović translated Catechism of a
revolutionist by Sergey Nechayev. He added some of his viewpoints to
the translation. That document has a special historical importance as
it sheds a light on thoughts of the Young Bosnia members in general.
Gaćinović mentioned that he was sending Catechism of a revolutionist
only for reading purposes (Dedijer 1966: 366-367). As far as other
Bakunin’s texts, Gaćinović also sent to Preporod Bakunin’s manifesto
to the Russian students from 1869 (Ibid.: 367).
The Young Bosnia movement was not inspired by a similar
organization in Serbia, because there was no such organization in
Serbia, however, in the revision of history at the beginning of the 21st
century, they pose the similar questions contrary to the academic facts
and historical logic. Serbia was a free country back then, accepting
progressive social-democratic ideas from France, Russia, Switzerland
and other countries which the Serbian intelligentsia got to know during
their education. Since the intellectual elite in Serbia knew what the
position of the Slavic people was in the unfree monarchies, they wanted
to improve that position, however they did not have any activities in
creating youth or secret organizations. There were no experiences
in the forming of youth political organizations in Serbia, and the
Serbian Government gave up the right to allow any kind of activities
death, the president of the Italian Senate at that time, Giovanni Spadolini, compared
Guglielmo Oberdan to Jesus Christ. (Kljakić 2013).
57
in their country against Austria-Hungary. The Young Bosnia members
found their inspiration for the revolutionary action in similar youth
organizations formed amongst the unfree nations of Europe since
1831. They followed the example of Young Italy by Giuseppe Mazzini
that fought for the liberation and unification of all Italian countries into
free Italy in two periods: 1831-1834 and 1840-1848. Approximately at
the same time secret revolutionary organizations Young Germany and
Young Switzerland were formed. Young Germany disappeared from
the political scene in 1850, while a society of German writers continued
to work under the same name. Young Poland lasted for a very short
period of time: 1834-1836, when her founders fled to Switzerland. The
Young Czech Party members were the “National liberal party” formed
in 1874, which immediately began to be thorn by fraction conflicts
with multiple ideas of which the following are the most important:
Austria -Hungary should be transformed into a three-part empire with
Slovenian element or to create an alliance of Slovenian people under
the auspices of the Russian Empire. Shortly before and at the time of the
formation of the Young Bosnia movement, there were Young Dalmatia
and Young Croatia movements in the nearby neighborhood. Young
Bosnia cooperated with the Young Croatia movement. At the beginning
of 1912, Croatian students organized a general strike against the AustroHungarian regime in which a few students were slightly wounded.
Similar demonstrations of Sarajevo students followed immediately,
organized by Luka Jukić, from Bosnia, a law student in Zagreb, later the
assassin of the Croatian ban Cuvaj. At the protests in Sarajevo, the most
fervent speech against the anti-Yugoslav politics of Austria-Hungary
was delivered by Tin Ujević, an emissary of the Zagreb students. In the
Ottoman Empire itself, a movement of Young Turks for the creation
of modern Turkey was formed in 1876, which under the leadership
of Kemal Ataturk won at the internal plan to abolish the Sultanate in
1908, however, at the foreign political and military plan, it significantly
weakened the empire. Before Gaćinović’s brochure “Smrt jednog
heroja” (Death of a hero) appeared, Mazzini’s writings on the goals of
the fighting of Young Italy had been well known and popular amongst
the members of Young Bosnia. Few intellectuals were familiar with
the socialist ideas of Marx and Engels, Marx’s socialism, revolutionary
ideas of Trotsky and anarchistic ideas of Bakunin. Gaćinović made a
significant contribution for them to opt for the revolutionary struggle
and sacrifice for the common good. They were also familiar with the
revolutionary turmoil in Russia more than social-democratic ideas
58
Radoslav Gaćinović
European Concept of the Young Bosnia Movement
brought by Svetozar Miletić, Svetozar Marković and Dimitrije Tucović
in Serbia. No ideas or assistance for the organization of the Young
Bosnia movement came from the official Serbia, where a secret and
much more powerful organization “Ujedinjenje ili smrt” (Unification
or death) was not to be formed for a long period of time. Unbearable life
under the Austro-Hungarian Monarchy rule resulted in the occurrence
of many assassinations before the Sarajevo assassination in the territory
of the Austro-Hungarian Monarchy itself. Analyzing the situation of
that time, Ivo Andric wrote: „Our entire society indecentlysnores, only
writers and revolutionaries are alert”.
Political assassinations were a common occurrence at the turn of
the 19th to the 20th century. The Young Bosnia members knew about
a failed attempt by a Young Italy member Oberdank to assassinate the
Austrian Emperor Franz Joseph. The assassin was executed in 1882, a
monument to his honor was erected in Venice in 1912 and a favored
cult was created around his character. They also knew about the
assassination of the Austro-Hungarian Empress Elisabeth (Elisabeth
Amalie Eugenie) carried out in Switzerland on 10 September by an
Italian anarchist Luigi Lucheni in 1898. They were also familiar with
the assassination of King Aleksandar Obrenović in 1903. They knew
about the political assassination in the Hungarian Parliament in 1912
carried out by a member of the Parliament Gyula Kovácson the Count
Tisza. During that year of 1912, Muslims Đulaga Bukovac and Ibrahim
Fazlinović planned an assassination of the Emperor or Heir to the throne,
whoever came to visit Bosnia and Herzegovina first. The assassination
was never carried out as, in the meantime, the First Balkan War broke
out in which they also participated as volunteers. In Zagreb, apart from
the assassination attempt by Jukić on Viceroy Cuvaj, an assassination
of the Austro-Hungarian Commissary Skerlec was attempted by Stefan
Dojčić in 1913 and Jakov Šefer in 1914. A Young Bosnia member,
Croat Srećko Džamonja intended to assassinate the Minister of Foreign
Affairs of Austria-Hungary, Berthold. When he came to Belgrade to
get the weapons, those he spoke with talked him out of his intentions,
because “... it would do Serbia more harm than good”.
Was Princip’s generation susceptible to the external influences? Were
those Marxist ideas of gradualism or the social-democratic teaching that
treats the fighting against the state terror with the emphasis on the mass
resistance movement against harsh social and economic circumstances
or, anarchistic theories on a widespread use of individual action against
59
an occupier? Based on the facts, science gave answers to those questions
long time ago. Some writers claim that organization Ujedinjenje ili
smrt (Unification or death) politically indoctrinated the Young Bosnia
movement, which is easily confuted based on the historical facts. One
of the Young Bosnia members Bogdan Žerajić attempted assassination
on General Marijan Varešanin on 15 June 1910, when Ujedinjenje ili
smrt organization did not even exist. It should be pointed out that, in
the preparation of the assassination, Ujedinjenje ili smrt4 organisation
offered significant support to the Young Bosnia members, but only
material support, as Apis himself was against the assassination later on.
Gavrilo Princip and Nedeljko Čabrinović stated at the trial that they
intended to buy the weapons with their money, however, since they did
not have enough money, they turned to Milan Ciganović for help, and,
through his mediation, to Vojislav Tankosić. It is not known whether
anyone else from the Black Hand knew about the assassination, but it
was affirmed that neither the Government of Serbia nor the Supreme
Command were informed about their plans (Mitrović 1983: 118-122).
It is certain that Princip and his group ideologically differed from
Ujedinjenje ili smrt organization. Differences were not only in the
general philosophy of life but also in the views of resolving the national
issue, internal problems among the South Slavs, and the structure of
the new state after the collapse of the Austro-Hungarian Monarchy.
Determination to Sacrifice for Freedom
In his 3 essays on Žerajić (Stojanović 1929), Vladimir Gaćinović
glorified the sacrifice as the best method to create a new religious
impulse among the Young Bosnia members. Part in the formation of
his concept on sacrifice had Mark Andreyevich Nantanson5. Natanson
4 Ujedinjenje ili smrt (Unification or death) was a secret, conspiracy organization also
known as Crna Ruka (Black Hand) established on 9 May 1911 in Belgrade. It was formed
by a group of military officers and civilians, who participated in the May Coupe of 1903
(Majski prevrat 1903), with the aim to fight for the unification of all Serbs. It gained a
significant political and social influence, so it often interfered with the Government.
In the first days of 1917, a conflict between the White Hand and Black Hand began
in Thessaloniki. After the trial of Apis and others (Salonika Trial), the organization
disintegrated (Vojni leksikon 1981: 1104).
5 Mark Andreyevich Natanson Boborov (1850–1919),a socialist and revolutionary who
had an important role in the Russian revolutionary movement in 1869. He was living
as a migrant in Switzerland at that time, and Vladimir Gaćinović often visited him and
respected him very much. (Gaćinović 1956: 241; Stojanović 1929).,
60
Radoslav Gaćinović
European Concept of the Young Bosnia Movement
was teaching Gaćinović that the highest aim of life is the sacrifice of a
human being and existance for the liberation of the repressed people.
Sacrifice of Bogdan Žerajić, one of the founders of the Young Bosnia
movement who, in the state of despair after the annexation of Bosnia
and Herzegovina, decided to assasinate the Emperor Franz Joseph,
when he visited Mostar on 3 June 1914, particularly drew Young Bosnia
members to the Kosovo myth. Žerajić changed his decision in the last
moment, although he was only a few steps away from the Habsburg
Emperor, with a revolver in his pocket. He returned to Sarajevo,and on
the day when the new Bosnian parliament Sabor opened on 15 June
1910, he fired 5 bullets at the Provincial Governor General Marijan
Varešanin, and shot himself with the sixth bullet, convinced that the
assassination was successful (Dedijer 1966: 390). Although Žerajić
was burried secretly, the Young Bosnia members found his grave and
adorned it with flowers. After the arrest, Princip said in his statement
that he hadsworn at his grave that he would revenge his death, and
when Princip visited Serbia for the first time, he brought back with him
to Bosnia a handful of „free Serbian soil” (Lebedev 1936) and laid it on
Žerajić’s grave, and the last time Princip visited Bogdan Žerajić’s grave
together with Danilo Ilić and Neđa Čabrinović was on the eve of 28th
June.
After the annexation of Bosnia and Herzegovina, Bosnian and
Herzegovinian students said that they would not recognize the
annexation at any cost, as it represented nothing but a robbery, and
that „if Austria-Hungary wants to swallow us, we will bite through
its stomach”. (Dedijer 1966: 293) All Young Bosnia members had
deep interests in literature and poetry, some of them became talented
poets in their short life, and some became great writers (Ivo Andrić),
philosophers, university professors (Pero Slijepčević, Vaso Čubrinović).
They were especially inspired by the works of Friedrich Nietzsche,
Henrik Ibsen, Oscar Wilde, Walt Whitman, and other protagonists of
literary anarchism.
Situation in which the South Slavs found themselves just before
1914 was very complex. Most people were striving to express their
revolt not only against national oppression but against the chains that
were smothering the life in every field.
The Young Bosnia members were great patriots. Their longing for
freedom must be observed and approached interdisciplinary, from
psychological, sociological and philosophical aspects. For Young
61
Bosnia members, a special inspiration was the heroism of Miloš Obilić,
his self-immolation in his battle against a tyrant and tyranny. Obilić
was and remains the symbol of the Serbian heroism and following his
example libertarian ideals and decisiveness were born to never and at no
cost recognize the slavery. Heroic popular songs were reflecting the entire
Kosovo legend upon which for centuries motivation and fearlessness
of the Serbian people were built. Kosovo myth also developed the
cult of revenge. The Serbian epic songs were read and translated into
their languages with utmost respect by the greatest writers and poets
in the world –Johann Wolfgang Goethe, Sir Walter Scott, Alexander
Sergeyevich Pushkin... The famous American journalist John Reed
wrote: „Every Serbian common soldier knows what he is fighting for.
When he was a child, his mother greeted him with words Hello, the
avenger of Kosovo!”A great Serbian poet, statesman and bishop, Petar
Petrović Njegoš, claimed that anyone who overthrows a tyrant fulfills
God’s mission. In his work Lažni Car Šćepan Mali (The fake tsar Stephen
the Little) he glorifies the revenge in the name of the higher God’s law.
The same idea was expressed by Seneca: „No sacrifice is more pleasing
to God that the blood of a tyrant”. However, the source of the right to
resist a tyrant Njegoš did not find only in the God’s natural law, beyond
nature, he also looked for its evidence in the nature of human society as
such, in continuous rebellions of the South Slavic peasants against the
oppressive Ottoman’s rule.
The Young Bosnia members would definitely be the most
progressive part of the revolutionary movements of the South Slavs in
the territory of the Habsburg Monarchy. For them, the assassination of
the archduke Franz Ferdinand meant the murder of a tyrant, carried
out for the common good based on the learning of the natural law that
all people are born equal and as such can stand up against violence and
those who break the human rights and freedoms of citizens.Especially
since the South Slavs were among the last Europeans who managed to
create their own national states.
From the annexation of Bosna and Herzegovina in 1908, the AustroHungarian Monarchy continuously prepared to attack Serbia.Viennese
bourgeois state official and diplomat Leopold von Berchtoldwas
very aggressive towards Serbia, and his first associate count Janós
Forgáchfostered hatred and contempt towards the kingdom. The proof
was his insisting on putting a maxim on all the offices of the Austrian
Government on the Ballhausplatz: “Serbia should be destroyed (Serbija
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Radoslav Gaćinović
European Concept of the Young Bosnia Movement
delenda est),’’ and they greeted Serbs with the following words: ”Alle
Serben müssen sterben’’, meaning ‘All Serbs must die.’’ The wave of
Serbofobia engulfed the entire monarchy. A poet Karl Kraus made
a historical slogan „Serbien muss sterbien” („Serbia must die”), and
paper slips with that wording were placed on the tables in all taverns in
Sarajevo (Ekmečić 2010: 345).
The most influential revolutionaries –the young men in Bosnia
and Herzegovina, Bogdan Žerajić and Vladimir Gaćinović more than
others mentioned the „Serbhood”.They had the greatest influence in
Sarajevo (Slijepčević 1929: 188). The youngest, revolutionary Young
Bosnia generation of Serb members from Bosnia and Herzegovina, had
no unique, and particularly no clear viewpoints at that time regarding
the Yugoslav issue, although it was exactly that generation that was
considered the main carrier of the Yugoslav idea in that region before
the World War I. However, its main ideologist, Vladimir Gaćinović,
was no sentimental towards the idea of Yugoslavism and he saw it as
„mixing the Croatian water with Serbian wine” (Dedijer 1966: 348).
Programme articles he wrote at that time, were supremely permeated
solely with the Serbian national idea and in them, up until the war,
there was no mention of the Yugoslavianism as a possible solution of
the Serbian national issue.
Unlike Gaćinović, Dimitrije Mitrinović, who has been considered
the second main ideologist of the revolutionary youth, was a man of
much different views and philosophy of life. Already in his high school
days, he had the understanding for the Yugoslav idea, advocating for a
unique literature of Serbs and Croats, which could have been the basis
of their unification (Ibid.: 290). His views would only strengthen later
on and formulate during his study in Zagreb, especially during his
friendship with Ivan Meštrović, whom the contemporaries at that time
considered „the only integral Yugoslav”.
The well known motto of the youth revolutionary movement
Young Bosnia was: We want to either die in life or live in death. From
this suggestive assertion of theirs, it is obvious that they did not fear
death, and that their conscious was intrinsically permeated with the
philosophy of necessity to die for the future and freedom. Vladimir
Gaćinović met with Gavrilo Princip for the first time in Sarajevo, in the
apartment of Borivoje Jevtić, where he usually stayed. He was leaving
a strong impression on all Young Bosnia members, particularly on
Mehmedbašić and Princip, and all his youth friends thought that it had
63
a crucial influence on them and prepared Princip and comrades for
action. So did Borivoje Jevtić, for example, write in 1920: „On Princip,
who mockingly look at people, Vladimir made an unusual impression...
The first moments with Gaćinović became permanent for Princip. He
was with Gaćinović even when he was not with him. He was impressed
by his moral strength and his apostolicity, which in the name of the aim
that it served calmly passed over all the sufferings, did not give in to
obstacles, did not subside from persecution” (Gaćinović 2014: 247).
Science established long time ago that the assassination in Sarajevo
was not the cause of the Great War 1914–1918, but its reason. On the
other side, it was an unexpected gift from the god Mars to the belligerent
Vienna side that, since the annexation crises 1908–1909, had been
looking for a reason to attack Serbia and „appease” the South Slavs,
expanding the Habsburg rule to the very doorstep of Thessaloniki. It
is only in this context that national aspirations of the South Slavs and
colonial conditions in Bosnia and Herzegovina may be discussed as
one of the many reasons of the World War I. In this respect, there is
much truth in the conclusions of the historian and economist Veselin
Masleša, that Princip, with his gun wanted to stop Drang nach Osten”
(Masleša 1945: 45).
Hypotheses according to which the assassination in Sarajevo
was inspired by secret services of Russia, France and Great Britain,
or similar organizations in Germany and Hungary, and the military
intelligence service “EVIDENCBIRO “of Austria, either directly or
indirectly, were not confirmed by historical studies, and insisting on
these hypothesis clouds the relevant historical facts in the region of
Bosnia and Herzegovina in time of the Austro-Hungarian terror at the
beginning of 20th century. The Young Bosnia members did not want
other state but their own and freedom in it, which is why that legitimate
right must always be considered and respected. Science does not allow
for improvisations, and it condemns any attempt with regards to the
domination of politics over science, like the malicious thesis on the
character of Young Bosnia. Such thesis are not harmless, but malicious
and hazardous, as they distort the role of the Serbian people in history,
and mislead public opinion. When Ferdinand arrived in Bosnia and
Herzegovina to attend the maneuvers of the 15th and 16th Corpuses
of the Austro-Hungarian army, he said: ‘’In Bosnia and Herzegovina,
I do not recognize any nation. They are all Bosnian to me, their flags
do not exist, there is only the flag of the Austro-Hungarian Monarchy
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European Concept of the Young Bosnia Movement
that exists,’’6 which additionally irritated the people of Bosnia and
Herzegovina. After the assassination, Austria-Hungary started to use
the most brutal violence, massive killings and arrest of innocent people,
women and children, in Bosnia and Herzegovina7 especially in the
Eastern Herzegovina – the centre of popular resistance and preparation
of the people for the new uprising against the Austro-Hungarian
Monarchy.
One month after the assassination by Princip,8 World War I began
– following the Austro -Hungarian ultimatum to Serbia on 23 July
2014 and declaration of war on 28 July, and the German declaration
of war against Russia on 1 August, France on 3 August and the British
declaration of war to Germany 4 August 2014.That war changed the
map of Europe more than any until then. Four empires failed, and
with them the dynasties of Habsburg, Romanov, Hohenzollemand,
the Ottoman dynasty, which ruled the empires for hundreds of years.
Austria-Hungary had intentions to attack Serbia immediately after the
Treaty of Bucharest, in the autumn of 1913, and had already carried out
preparations and asked for the agreement of the allies. One statement
of the official Italy turned away Austria-Hungary from taking that step.
However, it only meant putting off the war, for which the Viennese
military and political officials continued to prepare. According to the
admission of the Emperor Franz Josephin a letter addressed to the
Emperor Wilhelm soon after the assassination in Sarajevo, the Viennese
government – in spite of the earlier Italian warning – still unrelentingly
decided to go into war with Serbia. On the Ballhausplatz, back in the
first days of June 1914, a memorandum for the Emperor Wilhelm was
6 Preparing for the Great War, the Austro-Hungarian Monarchy took a loan of 400 000 000
crowns , which made all the European nations worry, including the English who brought
the monarhy to Bosnia and Herzegovina. To that end, it also changed the ethnic structure
of the BiH population. In the period from 1878 to 1914, 140 000 Muslims and 40 000 Serbs
moved out of Bosnia and Herzegovina, while during the same period 230 000 Catholics
moved into Bosnia and Herzegovina.Franz Ferdinand, at dinner in Ilidža, the day before
the assasination, confided to the chief of his operative office, colonel Metzger that„it was
decided in Konopište that an immediate atack on Serbia is to launched immediately after
the maneuvers”. A meeting between the Emperor Wilhelm II and Franz Ferdinand in
Konopište was held on 12 June 1914 (Gaćinović 2014: 116).
7 “Arad was a big, live Serbian ossuary, where 5.500 people from Bosnia and Herzegovina
were interned, among them 400 children, of which 2.200 stayed in Arad forever” (Ćorović
1920: 98).
8 On Saturday, 28 June, on Vidovdan (St. Vitus Day), at exactly 10.55 a.m. Gavrilo Princip,
from a distance of 5-6 steps, assasinated the Austro-Hungarian Heir to the Throne Franz
Ferdinand from semi-automatic pistol no. 19074 (Gaćinović 2014: 322).
65
drawn up including all the reasons why Austria-Hungary, at all costs,
was trying to carry our armed action against Serbia. In the letter of the
Austrian Emperor, it was explicitly emphasizedthat the memorandum
had been written before the Sarajevo Assassination. The Emperor
Franz Joseph delivered to the Emperor Wilhelm not only the views
of his government – laid down in the memorandum – but his own
views in relation to Serbia and its „hostile tendencies against AustriaHungary.” In the letter he further claimed that Serbia had gained a huge
increase in the territories and population, which made it become two
times bigger, so its aggressiveness towards Austria-Hungary became
two times more dangerous (Đorđević 1922: 13). It did not take much
to convince the Emperor Wilhelm, who had been preparing for the
war many years before that, constantly looking for the reason for the
war. He enthusiastically accepted the Austrian intention and already
on 23 July 1914 the Austro-Hungarian envoy in Belgrade, baron
Giesl (Wladimir Rudolf Karl Freiherr Giesl von Gieslingen) could
submit an ultimatum note to the Serbian Government, requesting its
unconditional acceptance within 48 hours.
Leo Pfeffer in his book (Pfeffer 1938: 132-137) claims that it was clear
to him from the beginning that the responsibility of the official Serbia in
the assassination of Franz Ferdinand would not be proved, and that the
result of his investigation confirmed his belief. In that respect, Vienna
showed certain impatience, and sent a special envoy to Sarajevo who
was supposed to get the information on the investigation and affect its
course. It was a higher ranking official of the joint Ministry of Finance
in Vienna, Friedrich von Wiesner, who, after a detailed investigation,
found out that Serbia was not responsible for the assassination of Franz
Ferdinand in Sarajevo. A professor at the University of Belgrade and
Pašić’s advisor and academic, Stanoje Stanojević, although he did not
like Apis, in his book published in 1923, claimed that neither Apis
nor anyone from Serbia gave the initiative for the assassination, but
rather that it came from Gavrilo Princip and his cohorts from Bosnia
and Herzegovina. A French historian, Jean-Jacques Becker, university
professor and president of the Centre of the Great War History, in his
book ‘’Year 14’’, edition 2004 and 2013, claimed that the assassination
was ‘’decided, organized and carried out by a small group of Bosnian
students, enthusiastic nationalists, gathered around Princip.’’ The best
estimation of the political background of the Sarajevo Assassination
was given by one of the participant in it: ‘It was without any thinking,
like when the water hits, without any systematicity.’
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European Concept of the Young Bosnia Movement
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Kljakić, S. (2013) „Revizija prošlosti u režiji velikih sila”, Politika, 9. jun. 2013.
Lebedev, V. (1936) „Rođenje Gavrila Principa“, Politika, 28. septembar 1936.
Locke, J. (1988) Two Treatises of Civil Government. Cambridge: Cambridge
University Press.
Masleša, V. (1945) Mlada Bosna. Beograd: Kultura.
Mitrović, A. (1983) „Suočavanje sa srednjoevropskim imperijalizmom“. In: Andrej Mitrović (ed.) Istorija srpskog naroda“, vol. VI-2. Beograd: Srpska
književna zadruga. pp. 7-106.
Nedić, V. (1959) Sima Milutinović Sarajlija. Beograd: Nolit.
Parežanin, R. (1927) Nekoliko reči o Žerajić – Principovom naraštaju. Subotica:
Književni centar.
Pfeffer, L. (1938) Istraga o Sarajevskom atentatu. Zagreb: Nova Evropa.
Slijepčević, P. (1929) Mlada Bosna, napor Bosne i Hercegovine za oslobođenje
i ujedinjenje. Sarajevo: Izd. obl. odbora nar. odbrane.
Stojanović, N. (1929) O zadacima Bosne. Novi Sad: Letopis Matice srpske.
Trišić, N. (1935) Slučaj Muhameda Mehmedbašića. Sarajevo: Pregled.
Vojni leksikon (1981) Belgrade: VIZ.
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68
Institute for Political Studies
UDC 342.41:321.7(497.11)”20””
Manuscript received: 04.09.2014.
Accepted for publishing: 30.09.2014.
Original scientific paper
Serbian Political Thought
No. 2/2014,
Year Vl, Vol. 10
pp. 69-87
Marijana Pajvančić1
Faculty of European Legal and Political Studies, Novi Sad
Ljubica Đorđević2
Faculty of European Legal and Political Studies, Novi Sad
Serbia in Constitutional Limbo:
Democracy without Constitutionalism 3
Abstract
The paper addresses the problem of the constitutionalisation of the Serbian
polity. The analysis in the paper goes in three parts. Part one examines whether
there was a “window of constitutional opportunity” in Serbia after 2000, and we
examine which peculiarities of the Serbian democratic tradition have burdened
the constitutionalisation process. In part two we explore the weaknesses of the
constitution of 2006. We examine the strategy of the constitutional continuity, as well as the procedural and substantive defects of the constitution which
have led to its low legitimacy. In the final part we outline the incapability of the
constitution to frame the political process, to limit the political power and to
channel it into democratic institutions.
Almost 14 years after the overthrow of Milošević and the initiation of the
democratization process Serbia has not manage to substantially constitutionalize the polity. Despite the adoption of a new constitution in 2006, the bad tradition of façade-constituality was not broken. The over-hasty adoption of the
constitution had led to violation of the procedure and to mixed quality of the
constitutional provisions. From the very start the democratic legitimacy of the
constitution was low, and it showed no capacity to channel the political power.
1
2
3
Professor
marijana.pajvancic@gmail.com
Assistant professor
ljubica.djordjevic77@gmail.com
Paper presented at the Workshop 10: The Constitution and Illiberal Democracies at the
IX World Congress of Constitutional Law (Oslo, 16-20 June 2014). http://www.jus.uio.
no/english/research/news-and-events/events/conferences/2014/wccl-cmdc/wccl/
69
The political players have shown no willingness to submit government actions
to objective and impersonal rules. Furthermore, almost every stakeholder perceives the constitution as an interim act needed to be changed, which additionally undermines the authority of the constitution. Under such circumstances,
the constitutional issue remains latently opened and the state is in a latent constitutional crisis. This corresponds with the specific para-constituality of the
Serbian order in which the constitution is just a façade, and the power is not
rooted in the state institutions but in the political party oligarchies. The constitution has not managed to diminish this dualism (nor was this the intention of
the constitutional maker) and the democratization process in Serbia got stuck
in some form of a pluralistic party state.
Keywords: constitution, democracy, democratic transformation, Serbian
Constitution, partocracy.
Introduction
Six years after the electoral revolution and the overthrow of
Milošević in 2000, a new constitution was adopted in Serbia. However,
the rationale for the adoption of the constitution was not to establish
a constitutional framework for a democratic order based on the rule
of law, but rather a “state reason” of guaranteeing the sovereignty over
Kosovo. Furthermore, it was because the adoption of the constitution
was neither a result of a comprehensive public debate nor a reflection
of a consensus on basic principles and values of the democratic
polity that the constitution’s legitimacy was placed in doubt. With
this constitution the tradition of a façade-constitutionality in Serbia
continues. The constitution has no authority to institutionalize political
decision making and to “force” political actors to submit government
actions to objective and impersonal rules. Given that the constitution
is perceived as an interim act that does not meet the needs of the polity
and the society and thus should be changed, the constitutional debate
is reduced to a matter of a daily politics and the constitutional crisis is
latent.
There are three parts to the analysis in the paper. Part one examines
whether there was a “window of constitutional opportunity” in
Serbia after 2000, and we examine which peculiarities of the Serbian
democratic tradition have burdened the constitutionalisation process.
In part two we explore the weaknesses of the constitution of 2006. We
examine the strategy of the constitutional continuity, as well as the
procedural and substantive defects of the constitution which have led
70
Marijana Pajvančić, Ljubica Đorđević
Serbia in Constitutional Limbo: Democracy
without Constitutionalismt
to its low legitimacy. In the final part we outline the incapability of the
constitution to frame the political process, to limit the political power
and to channel it into democratic institutions.
The Constitution and the Serbian Democratic Transition: Was there
a Window of Constitutional Opportunity?
The adoption of a new constitution is one of the milestones of the
institutionalization of democracy after the breakup of the autocratic
regime. The most favorable moment for the adoption of a new democratic
constitution lays immediately after the break of the old regime. At this
moment the “window of constitutional opportunity” is opened widest,
since some problems that inevitably occur in further phases of the
transitional process are still not virulent. The satisfaction and the glory
caused by the overthrow of the non-democratic regime are high and the
impetus for establishing a democratic order is strong. The consensus
among the democratic allies is at this stage still stable, and they are
willing to put back their particular interest for the sake of ideals of the
constitutional basis for the future (Rüb, 1996: 52). Since social cohesion
in this moment is high, it offers a possibility for the new constitution
to be more inclusive. If however the constitutionalisation process takes
too long, and the shortly opened window of constitutional opportunity
closes, chances for the phase of the institutionalization of democracy
to produce desired goals will decrease. With time the euphoria of the
victory dwindles as well as the impetus for the cooperation among
the “democratic” forces caused by the fight against the old regime as a
common enemy. Formerly allied regime opposition becomes mutual
political opponent. The hesitation in the constitutionalisation process
implicates the danger for the constitutional debate to degrade to the
daily political struggle in which the political actors use this debate to
promote their political programs instead of focusing on the universal
acceptable framework for the future democratic order (Dimitrijević
2004: 70). Under these circumstances the constitution becomes an
object of political struggle whereas the constitution becomes merely
an instrument for securing or widening the political power positions
(Rüb 1996: 52).
With the overthrow of Milošević the necessary precondition to
dissolve the authoritarian regime and to initiate the democratization
71
process was met. On October 5, 2000, thousands of Serbian citizens
in massive protests demanded that Milošević accepted the results of
the elections and stepped down from the presidential post. Yet the
overthrow of Milošević was not the result of a pure revolution, but it
was a complex mix of a government change in democratic elections, a
civic uprise, and a specific pact between the elites. This mix determined
the quality of the regime change and consequently the process of the
democratic transition. One of the most significant failures of the
regime change in Serbia initiated in October 2000 was the lack of the
constitualisation of the new order. Instead of the radical break with
the old regime the strategy of the new political elite was to preserve
constitutional and institutional continuity (Orlović 2008: 56). Yet,
the constitutional continuity was not used to effectively dissolve the
structures of the old regime, but in fact it preserved the ideological,
political, and legal core elements of the old system (Dimitrijević 2004:
61f). Although the electoral revolution in 2000 to some extent provided
a window of constitutional opportunity, there was no consensus on the
issue and constitutional reform was blocked for years: It took six years
to overthrow the 1990 constitution and to adopt a new one.
One of the central questions here is whether in Serbia after 2000
the window of constitutional opportunity was really opened, and if it
was why this opportunity was not used. According to the above noted
theoretical model, the window of constitutional opportunity is opened
in a short period after the breakup of the authoritarian regime, and
respectively one can state that after the overthrow of Milošević it was
the right moment to set new constitutional framework for the new
democratic polity (cp. Orlović 2008: 55). However, the situation was
not so simple since the Serbian transition had some peculiarities which
made it different from the transition processes in post-communist
states.
The central specific feature of the Serbian democratic transition
is the unsolved issue of the statehood. Statehood is an important
precondition for a functional democratic order, and democratic
reforms can only be implemented successfully within a state (Linz/
Stepan 1996: 14). In October 2000 Serbian statehood was not a clear
issue, and it was not clear what should be constitutionalized. At the
moment Milošević was overthrown (as the president of the Federal
Republic of Yugoslavia), Serbia was a republic in a non-functional
federation with Montenegro, and it had severe sovereignty deficits in
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Marijana Pajvančić, Ljubica Đorđević
Serbia in Constitutional Limbo: Democracy
without Constitutionalismt
Kosovo. Any new constitutionalisation of Serbia at that time would
have requested from the Serbian constitutional maker to take these
circumstances into consideration and to take stand to the statehood
issue. It is obvious that at that time Serbian elites were not ready to deal
with the problem of the “unfinished statehood”.4 The phenomenon
of the “unfinished statehood” and the constitution are deeply
interconnected in Serbia, to the extent of a vicious circle: The state
cannot be constitutionalized since it is not formed yet, and it cannot be
formed since it is not constitutionalized. This paradox has its roots in
the Serbian nationalism that cannot accept the reality of the dissolution
process of the former Yugoslavia and the scope of the territory on
which the power (sovereignty) of the Serbian state should apply. So,
even if in the late 2000 or early 2001 when the window of constitutional
opportunity was considered to be opened this was not fully the case,
since it was not clear whether constitutional changes should be
made at the federal level or at the level of the Serbian republic. In this
respect, the constitutional changes in Serbia were postponed until the
situation with Montenegro was resolved, and this “constitutional gap”
has additionally underpinned the constitutional continuity. As the
federation was, under the great pressure of international community,
reformed into the State Union of Serbia and Montenegro in 2003, this
has formally provoked the opportunity to reconsider the constitutional
issue in Serbia but this opportunity was neglected. Although the Law
on Implementation of the Constitutional Charter of the State Union of
Serbia and Montenegro set a clear and time-limited obligation for the
member states to harmonize their constitutions with the Constitutional
Charter, neither of them complied with this obligation. As in 2006 the
State Union ceased to exist, political players perceived the creation of
an independent state of Serbia as constitutional opportunity, one that
led to the new constitution being adopted in November 2006. Yet, this
window of constitutional opportunity was not perceived as a chance
for a comprehensive constitutional reform which would set a solid
basis for the democratic order based on the rule of law. The adoption of
the new constitution was motivated with the “state reason” and it was
to a greatest extent linked to the Kosovo issue so as to constitutionally
4 The idiom „unfinished state“ was first used by Zoran Đinđić in his analysis of the
Socialistic Yugoslavia, and Nenad Dimitijević has developed this concept in his analysis
of the transformation processes in Serbia since 2000. See: Đinđić (2010); Dimitrijević
(2004).
73
safeguard the territorial integrity of the state. The dominant ratio of
the Serbian constitutional maker was to constitutionally guarantee the
position of Kosovo as an autonomous province in Serbia, and thus to use
the constitution as an instrument for the state reaction to the possible
independence declaration (cp. Pešić 2007: 77). The linkage of the state
issue and the constitutional issue has reaffirmed that as long as Serbia
is facing uncertainties with regards to its statehood the constitutional
issue is a “pending case”. In this respect, one could argue that none of
the windows of constitutional opportunity which have been opened
since 2000 was really a constitutional momentum. On the other hand,
one could also argue that, if the window of constitutional opportunity
was even opened, it is still not closed, since the constitutional dispute in
Serbia is still present.
Another peculiarity of the Serbian transition was in the specific
hybrid nature of the Milošević autocratic regime. Unlike the situation
in the states of the former “Eastern Bloc”, the Milošević regime was not
a communistic (although the majority of the previous communistic
nomenclature was in place), but a hybrid authoritarian regime based
on the mixture of nationalistic and socialistic ideology and on the
populism. In this respect, in the late 1980s and the early 1990s Serbia
had already undergone a specific “retrograde transition” in which the
communistic system was declaratively rejected, with no intention to
establish a democratic order, but rather a personalized rule. In line with
this trend a constitution was adopted in 1990 in Serbia that was free
from the communist ideology and the communist legal tradition, but
that was tailored to the governing needs of one particular man. However,
the constitution was only a façade and it did not have effective power to
frame the political process. Nevertheless, it was perceived as a symbol
of the Milošević rule and one of the main intentions of the Serbian
Democratic Opposition was to change the constitution after coming
into power. The pseudo liberal dimension of the constitution of 1990
was kind of a trap for the constitutionalization of the new democratic
order of 2000, since it did not contain provisions which would have
directly hampered political, economic, and social liberalization. The
experiences of the post-communist democratic transitions have shown
that these states were required to change their constitutions and free
them from communist legacy in order to even initiate and enable the
intended system change. The Serbian constitution of 1990 did not
contain such obstacles, and the Serbian political elite of 2000, faced
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Serbia in Constitutional Limbo: Democracy
without Constitutionalismt
with the difficulties that followed the breakup of the old regime and the
establishing of the new democratic order, considered that the transition
can perform under the old constitution, until the political power is not
consolidated. In line with this pragmatic approach the constitutional
change was not considered a priority. This attitude turned out to be
problematic for two reasons. First, the constitution has remained
a façade, since the political players have treated it as a necessity and
it had no capacity to constitutionalize the governance. On the other
hand, the whole reform process remained genuinely chaotic, since
without a constitution having its function, it was impossible to create a
comprehensive legal order.
The confused attitude toward the authoritarian past and the unclear
concepts of the future was one of the central obstacles, or one could
even argue, the central obstacle, for adopting a new constitution which
would decisively break with the old regime and set a solid basis for
institutionalizing a new democratic order. As Dimitijević has rightly
noted, creating constitutional norms presupposes “dialectic” pondering
of the past and the future; it presupposes a twofold reflection: one defining
the attitude towards the past, and other defining the framework of a new
order which should be achieved in the future (Dimitrijević 2007: 113f.).
The opposition coalition in Serbia of 2000 was aimed primarily on the
overthrow of Milošević and was fully confused about “the day after”.
This heterogeneous group lacked a common vision about the future
of Serbia, and the coalition members had a diverse attitude toward
the past (Pešić 2007: 66). Those who were eager to make a clear break
with the past and to create a modern and European Serbia were in a
minority (ibid.). This constellation reflected on the constitutional issue
which became a conflict spot between “legalists” (those who pleaded
for the strategy of legal continuity), and “reformists” (those who were
for a more resolute break with the past). In the context of such social
and institutional division it was impossible to create a minimal social
consensus necessary for the adoption of a constitution.
Since 2000, although the window of constitutional opportunity was
opened few times to different extent (immediately after the regime
change, after the State Union Serbia and Montenegro was created,
and in the moment Serbia became an independent state) there was no
momentum in Serbia with a difference between “normal” daily politics
and specific “constitutional” politics necessary to effectively seize the
constitutional momentum. The constitutional issue is degraded to the
75
“ordinary issue”, and as such it is latent. Since the constitutional question
is not resolved, the state is kept in the permanent constitutional crisis in
which the window of constitutional opportunity is paradoxically at the
same time not fully opened, but also not fully closed. Metaphorically
speaking, a constitutional momentum in Serbia is “a glass half full/
empty”.
Weaknesses of the Constitution and its Legitimacy Deficit
The constitutionalisation of the new polity can go through the
reinforcement of the old constitution, or its extensive amending,
or through adoption of an entirely new constitution (Merkel/
Sandschneider/Segert 1996: 13). The way the old regime breaks up can be
of importance for the constitutionalisation of the emerging democratic
order. If the breakup is a result of a bargain between the old and the
new structures, the future legal arrangements of the polity will take into
the account the interest of the authoritarian elites. The people are in
such cases rarely the pouvoir constituant but the constitution as an act
of the consensus reflects the arrangements with the old elites. The more
revolutionary breakup is more likely to lead to a legal (constitutional)
framework for the new democratic polity ab novo, with the possibility
to use the new constitution plausibly as an act of discontinuity. The
nature of the breakup of the old regime will affect the constitutional
change that can emerge either in line with the rules of the old order or
fully ignoring the previous legal order. The constitutional continuity
is not per se an obstacle for the transition from an authoritarian to a
democratic order. The rationale behind such continuity lies in the will
to perform a radical transformation in line with the legal procedures
of the breaking legal order. It mirrors the principle of the rule of law:
a society that aims to build a polity on this principle cannot break the
binding law despite its defects. However, constitutional continuity does
not imply the maintenance of the old system. The necessary changes
to the old system will be implemented within the scope of the legal
norms of this system. Even though the transformation in this case is
evolutionary, its outreach should be revolutionary. Constitutional
continuity should be short and dynamic, and the delegitimation and
annulment of the old order needs to be followed by the immediate
creation of a qualitatively better system. It is only in this manner that
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Serbia in Constitutional Limbo: Democracy
without Constitutionalismt
constitutional continuity can lead to the fast and in-depth change of the
old constitutional order (Dimitrijević 2004: 61f.).
In Serbia it took six years to overthrow the 1990 constitution and
to adopt a new one. Political players perceived the creation of an
independent state of Serbia in 2006 as constitutional opportunity, one
that led to a new constitution adopted in November 2006. To some
extent the constitutional amending process has been protracted since
2003 but it was more a mix of ad hoc measures than a comprehensive
procedure. For that reason the prompt actualization of the
constitutional issue in 2006 was surprising and motivated with the need
to declaratory safeguard the constitutional position of Kosovo. The
adoption of the constitution was neither a result of a comprehensive
public debate nor a reflection of a consensus on basic principles and
values of the democratic polity. New constitution is essential for the
institutionalization of democracy since it sets legal grounds for a new
democratic order. It should reflect the deepest values of the society and
the basic grounds for the democratic process (Schwartz 2004: 13). It
sets the legal framework for human rights protection and the model for
organization and legitimation of political power. Furthermore, the new
constitution should communicate with the society and offer effective
mechanisms for peaceful conflict resolution. The enforcement capacity
of the new constitution depends not only on legal instruments set to
ensure its implementation, but also on its legitimacy. The phase of the
adoption of a new constitution can underpin its legitimacy threefold:
through the procedures in which the constitution is adopted, the
perception of the constitution as an act of a consensus, and the wide
acceptance of values and rules enacted in it. The Serbian constitution
adopted in 2006 does not meet any of these requirements. It faces
procedural and material weaknesses and lacks democratic legitimacy.
The constitution of 2006 was adopted in line with the amending
procedure set out in the constitution of 1990. In the public discourse
regarding the constitutional change after 2000 there was an intense
debate about the way a new constitution should be adopted. Those
who were for a more resolute break with the old regime pleaded for
constitutional discontinuity and adoption of a new constitution with
no procedural links with the old constitution. According to this
approach the new constitution should have been adopted by a special
constituent assembly. The other approach was based on the strategy of
the legal and institutional continuity with the dominant argument that
77
the legality cannot be grounded in breaking the (constitutional) law. In
the ideological background of the strategy of legalism lays the intention
to perpetuate the legitimizing legacy of the old regime in order to
build a modern constitutional state on the grounds of the old regime
(Podunavac 2005: 15). As mentioned above, this strategy was used in
post-communistic states, whereas the framework of the old legal order
was used to perform the necessary changes of the old system. However
these changes were evolutionary in their form, but revolutionary in
their character. On the other hand, the strategy of constitutional and
institutional continuity which prevailed in Serbia did not have such
effects. The strategy of continuity could not be successful since the legal
grounds of the old system were devastated. In many important issues
Serbia was characterized with statelessness and “non-order” (ibid.)
and one could rightly ask if the concept of continuity was actually
grounded in a “quagmire”. Furthermore, the strategy of continuity can
be successful only if it does not last too long, and if the framework of
the new legal order consequently replaces the old system. In Serbia,
the strategy of continuity perverted from an instrument to a status,
whereas it led to actual conservation of the old system. This strategy
of continuity influenced the adoption of the constitution of 2006, both
with regards the adoption procedures and the text of the constitution.
Not only was the constitution of 2006 adopted in line with the
amending procedures of the constitution of 1990 but the implemented
adoption procedure was highly problematic. For the purposes of the
adoption of the new constitution the Serbian parliament has, just an
evening before the day the constitution was adopted in the parliament,
amended its rules of procedure and introduced a specific form of the
parliamentary work named “special session”. This was problematic since
the constitution acknowledges only two forms of the parliamentary
sessions, namely regular session and solemn session. There are
few arguments that further indicate the problem: the session of the
parliament was held on a Saturday which is a non-working day; the
session started in the evening (8 p.m.) although the parliament usually
stops its work at 6 p.m.; the MPs got the draft of the constitution just
before the parliamentary session, and they had no time to get informed
with the text; it is unclear if the parliamentary groups have met before
the parliamentary session on which the constitution was adopted; the
parliamentary committee, which has the competence to formulate the
draft text of the constitution, met just an hour before the parliamentary
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Serbia in Constitutional Limbo: Democracy
without Constitutionalismt
session in order to (formally) set the draft (until that moment the
“constitutional arrangements” were performed outside the competent
constitutional institutions); the work on the nomo-technical and
technical editing of the constitutional text were performed even on the
day of the parliamentary session; the parliamentary session lasted about
an hour (in which the prime minister, the president of the republic, the
president of the parliament, and the presidents of the parliamentary
groups held their speeches), and there was no parliamentary debate
on the text of the constitutional proposal (MPs waived their right to
expression in parliament, and no modifications were proposed to
the text) (Pajvančić 2006: 18). For the adoption of the constitution
the compulsory popular referendum was held, which again showed
some weaknesses in the adoption procedure. Here we name just
few: the law on referendum did not regulate many important issues
(such as financing of the campaign, the role of the media, campaign
silence, independence and impartiality safeguards for the institutions
which organize the referendum); the voting was held on two days
which is untypical in Serbia; the accurateness of the voters registers is
dubious; Albanians living in Kosovo were excluded from the process;
the institutions for organizing the referendum were problematic (with
regard to their structure and the way they were established); and it is
doubtful if the majority vote was actually achieved (Ibidem 21ff.).
In addition to procedural weaknesses, the constitution of 2006 suffers
from material weaknesses. With regards to the constitutional contents,
the constitution of 2006 reflects the strategy of the continuity since
this constitution did not make a genuine shift from the constitution
of 1990 (Molnar 2013: 35). The concept of the constitution of 2006
follows the rationale behind the constitution of 1990, and except
the wider catalogue of human and minority rights, this constitution
does not contain any regulation which would signalize the break of
the constitutional continuity. The constitution of 2006 is not a new
constitution, but much more a redesign (partly better, but partly worse)
of the constitution of the 1990 (Marković 2007: 53). This substantial
discontinuity with the constitution of 1990 is missing since the rationale
behind the constitution of 2006 was not to strengthen fundamental
rights, institutes of democratic governance, liberal economy, and open
society, but it was to stress out that Kosovo is “an integral part of Serbia”.
At the symbolic level the whole constitution of 2006 is charged with this
“Kosovo vow”. Since its first function was to (declaratory) safeguard the
79
Serbian sovereignty in Kosovo, its genuine function to constitutionalize
the polity has remained in the background.5
The third layer of the constitutional weaknesses refers to its
legitimacy deficit. The legitimacy of the constitution was very low from
the very start. The constitution of 2006 is an octroyed constitution
which excluded the citizens from its creation, and they were not able
even to discuss it for a day (cp. Pešić, 2007: 77). In line with their
specific needs the “rulers” have adopted the constitution for themselves
(Molnar, 2013: 33). As the Venice Commission has put it, “[…] another
aspect of the hasty drafting of the text is the lack of opportunity for
its public discussion. This procedure was motivated by important
political considerations and reflected specific difficulties in the country.
Nevertheless, it raises questions of the legitimacy of the text with
respect to the general public.“ (Venice Commission, para. 104). Not
only the citizens and their representatives in the Serbian parliament
were excluded from the constitutional process, but also some other
social players were excluded, such as institutions of the Autonomous
Province of Vojvodina, the national minority councils, unions, civil
society organizations, professional organizations etc. (Pajvančić, 2006:
19f.). This legitimacy deficit maybe could have been compensated, and
the authority of the constitution strengthened, if the political players
would have respected it and not treated it as a mere formality or a
façade. On the contrary, they were not willing to submit government
actions to rules and to institutionalize political decision making, which
additionally undermined the authority and the legitimacy of the
constitution. The constitutional debate remained opened, since the
constitution is perceived as an interim act that does not meet the needs
of the polity and the society and thus should be changed.6
5 With respect to democratization process the most obvious weakness of the constitution
lies in the nonexistence of the real separation of powers (both on horizontal and vertical
level). As the Venice Commission has stated in its Opinion on the Constitution of Serbia,
“the main concerns with respect to the Constitution relate, on the one hand, to the fact
that individual members of parliament are made subservient by Art. 102.2 to party
leaderships and, on the other, to the excessive role of parliament in judicial appointments“
(para. 106). The vertical separation of powers is not consistent, “for it entirely depends
on the willingness of the National Assembly of the Republic of Serbia whether selfgovernment will be realised or not“ (Venice Commission, para. 8). For a detailed analysis
of the Constitution see: Pajvančić (2009); Marković (2007); Komitet pravnika za ljudska
prava (2013).
6 According to the results of one survey performed in 2012, only 10% of citizens and 5%
of the members of the political elite expressed their opinion that the constitution should
not be changed. The constitution was rated with the average note 2.8 (grading 1 to 5). For
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Serbia in Constitutional Limbo: Democracy
without Constitutionalismt
Constitution and the Political Process: Defective Democracy in a
Partocratic State
The goal of the democratization process is the establishment of
a special democratic order in which political power is limited and
accounted for by objective legal (constitutional) rules. Political power
is set in democratic institutions wherein there is an institutional
connection between a legal order and a political process. Law sets legal
rules for democratic governance and constitutes a political process, yet
lawmaking is politicized and interconnected with political action. It is
in such an arrangement that a constitution gains significance for the
submission of politics to law. However, a constitution is a necessary
precondition for the establishment of constitutionalism, but rarely
is it a sufficient condition. It is not always the case that constitutions
are taken seriously or that constitutional norms always prevail in
cases of conflict with political interventions (Grimm 2010: 3). Some
constitutions lack serious intention to limit the rulers powers, or in
some cases constitutional rules do not enjoy full primacy over the
acts of government, but are legally superseded by political decisions
(Ibidem: 11). The quality of a democratization process in respect to the
successful constitutionalization of the political order can be measured
by whether a constitution has effective power to frame the political
process. The democratization process can lead to the establishment of
a liberal democratic order or it can be stuck in some form of defective
democracy (which can be manifested in diverse forms, such as electoral
democracy, illiberal democracy, semi-democracy, façade democracy,
etc.). According to the theory of Juan J. Linz and Alfred Stepan,
consolidated democracy must have five interconnected and mutually
reinforcing arenas. These arenas are civil society that functions on
the principle of freedom of association and communication; political
society that is based on free and inclusive electoral contestation; the
rule of law based on the constitutionalism; the state apparatus that is
organized on rational-legal bureaucratic norms, and the economic
society which rests on an institutionalized market (Linz/Stepan 1996a:
7-15). According to Linz and Stepan, all significant actors, especially the
democratic government and the state, must respect and uphold the rule
of law (Linz/Stepan 1996a: 10). As they note, a spirit of constitutionalism
detailed results of the survey, see: “Zašto Ustav mora biti promenjen“, available at: http://
www.fosserbia.org/projects/project.php?id=1656 .
81
“entails a relatively strong consensus over the constitution and especially
a commitment to ‘self-binding’ procedures of governance that require
exceptional majorities to change” (Ibid.). Further, constitutionalism
requires “a clear hierarchy of laws, interpreted by an independent
judicial system and supported by a strong legal culture in civil society”
(Ibid.). According to the concept developed by Wolfgang Merkel,
“an embedded, liberal democracy consists of five partial regimes: a
democratic electoral regime, political rights of participation, civil rights,
horizontal accountability, and the guarantee that the effective power
to govern lies in the hands of democratically elected representatives.“
(Merkel 2004: 36). Similar concept we can find at Puhle who identifies
11 criteria grouped in 5 groups: Electoral regime (consisting of elected
officials, inclusive suffrage, right to run for office/full contestation, free
and fair elections), Political Liberties/Public Arena (freedom of speech,
of the press and of information, freedom of association), Effective Power
to Govern (government by elective officials /no reserved domains),
Horizontal Accountability (checks and balances), Rechtsstaat (civil
rights, rule of law and judicial review/independent courts/equal access
to and equality in court, rights/ protection of minorities) (Puhle 2005:
9). According to Puhle, these criteria can be effectively implemented
in specific context which presupposes stateness, civil society, and
socio-economic context (ibid.). These concepts plausibly show that
democracy cannot be narrowed to the electoral mechanism, and that
electoral democracy is not sufficient enough to characterize an order as
genuinely democratic. The establishment of an electoral regime which
functions along democratic lines is sufficient enough not to consider
a regime as an autocratic, but if above mentioned additional criteria
are not in place, such an order is a defective democracy (Ibidem: 11;
Merkel 2004: 48).7 Such an order is in specific “political gray zone”
(Carothers 2002: 9), in which a political space for opposition parties and
civil society, regular elections, and democratic constitutions can exist,
but it suffers from “serious democratic deficits, often including poor
representation of citizens’ interests, low levels of political participation
beyond voting, frequent abuse of the law by government officials,
elections of uncertain legitimacy, very low levels of public confidence
7 Depending on which of the criteria is missing or perverted, defective democracy can have
different subtypes. Merkel identifies exclusive democracy, domain democracy, illiberal
democracy and delegative democracy (Merkel, 2004: 49ff), and Puhle identifies exclusive
democracy, illiberal democracy, tutelary democracy, delegative democracy (Puhle, 2005:
11ff).
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Marijana Pajvančić, Ljubica Đorđević
Serbia in Constitutional Limbo: Democracy
without Constitutionalismt
in state institutions, and persistently poor institutional performance by
the state” (Ibid, 9f.). The central constitutional question of the quality of
democracy is whether constitution can (together with other elements)
produce constitutionality. Whereas liberal democracy is based on
the rule of law and the supremacy of the constitution, in a defective
democracy a constitution has no power to produce constitutionality. In
defective democracies, most usually constitution as such is a façade and
the stakeholders are not inclined to submit themselves to legal norms
but pretend to be exercising their power within the constitutional
framework (Grimm 2010: 3).
More than a decade after the overthrow Milošević’s and despite the
fact that in 2006 Serbia adopted a new constitution, the statement that
“Serbia has a constitution, but it is not a constitutional state” (Pajvančić
2005: 277) is still up-to-date. Serbia is still captured in some form of
para-constitutionality in which the constitution is just the façade, and
the governing processes are actually displaced from the constitution.
Although in the past the regimes have changed, the relation between law
and politics has remained the same. Politics has never been functionally
subjected to a legal framework; consequently, no power had ever
unconditionally respected legality or the law (Belančić 2001: 208). The
Serbian political elite showed no willingness to depersonalize governance
by channeling it into the legal framework. In doing so it preserved the
elements of the legal façade of the previous systems. The way political
players have treated (and still treat) the constitution suggests the lack of
serious intent to constitutionalize the polity. Constitutionalisation here
refers to institutionalization of political power, in terms of channeling
power into institutions and establishing governing mechanisms in
line with constitutional procedures. In Serbia this is not the case since
the effective power lies not in the state institutions but in the hands of
the political (party) elites. This power constellation leads to a specific
dualism of the state, whereas the “constitutional” state is just a façade
or a shell whereas the real power rests in the “prerogative” state (special
political structure integrated by party channels, and which does not pay
attention to law, but is driven by the “state reason”) (Molnar 2013: 19,
33). In the center of the “prerogative” state lay political party elites which
are the genuine source of the almighty power in Serbia (Ibidem: 44)
and which are the main usurpers of the state power, the state property,
and the public sector in general (Pešić 2012: 174). Although Serbia has
reached the level of electoral democracy, it is stuck in some form of the
83
“pluralistic party state”. Paradoxically enough, the constitution of 2006
did not deconstruct the “prerogative” state, but it set some constitutional
safeguards for the party influence on the governing process. The most
controversial is Article 102.2 of the constitution which states that
a deputy shall be free to irrevocably put his/her term of office at the
disposal of a political party upon which proposal he or she was elected
a deputy. With this norm the constitution ties the deputy to the party
position on all matters at all times, and it concentrates excessive power
in the hands of the party leadership (Venice Commission, para. 53).
Due to the excessive role of the parliament in judicial appointments
(as foreseen in Articles 147.1, 147.3 and 153.3 of the constitution),
the power of the party leaderships reaches to the judicial branch. In
such constellation the executive remains almost free of any effective
control. Actually the control of the executive is shifted from the state
institutions and formal procedures to the pseudo-formal control
performed by the political party institutions. The recent reconstruction
of the Serbian government has shown that the ministers are not really
accountable to the parliament but to the political party boards and
party presidencies. The central indicator of the partocratic state in
Serbia is the party driven allocation and redistribution of the “public
goods” (in the wider sense). Political parties’ influence is not limited
to “traditional” political positions (ministers and state secretaries) but
also to all governing or management sublevels. Political parties have a
decisive role in almost all appointments and even in those cases which
demand the respect of the merit system. The party “prey” are not only
the positions in the government and the public administration, but
also the positions in the diplomacy, public companies and communal
service companies, institutes, agencies, funds, medical institutions,
schools, cultural institutions, etc. (Orlović 2012: 220; Pešić 2012: 186).
In the context of the weak economy which is still predominantly statedriven, the political power intertwines with the economic power which
additionally leads to the state capture. Furthermore, weak civil society
and weak public control, in combination with the lack of democratic
political tradition and democratic political culture, are not capable to
counterbalance the party dominated power structure and to effectively
contribute to the institutionalization of political power and its control.
84
Marijana Pajvančić, Ljubica Đorđević
Serbia in Constitutional Limbo: Democracy
without Constitutionalismt
Conclusion
Almost 14 years after the overthrow of Milošević and the initiation
of the democratization process Serbia has not manage to substantially
constitutionalize the polity. Despite the adoption of a new constitution
in 2006, the bad tradition of façade-constituality was not broken. The
over-hasty adoption of the constitution had led to violation of the
procedure and to mixed quality of the constitutional provisions. From
the very start the democratic legitimacy of the constitution was low,
and it showed no capacity to channel the political power. The political
players have shown no willingness to submit government actions to
objective and impersonal rules. Furthermore, almost every stakeholder
perceives the constitution as an interim act needed to be changed, which
additionally undermines the authority of the constitution. Under such
circumstances, the constitutional issue remains latently opened and
the state is in a latent constitutional crisis. This corresponds with the
specific para-constituality of the Serbian order in which the constitution
is just a façade, and the power is not rooted in the state institutions but
in the political party oligarchies. The constitution has not managed to
diminish this dualism (nor was this the intention of the constitutional
maker) and the democratization process in Serbia got stuck in some
form of a pluralistic party state.
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88
Institute for Political Studies
UDC 330.837:316.42
Manuscript received: 11.09.2014.
Accepted for publishing: 23.09.2014.
Original scientific paper
Serbian Political Thought
No. 2/2014,
Year Vl, Vol. 10
pp. 89-104
Aleksandar Novaković1
Institute for political studies, Belgrade
Neo-Institutionalism and the Success Story
of Capitalism: Two Different Approaches to
Social Change2
Abstract
The central weakness of every institutionalism is its attempt to elevate the
significance of formal and informal institutions as some exterior self-acting
mechanisms, productive or unproductive ones, extractive or inclusive ones,
above the factors that made them as such. Those other factors are paired and
merged with them. They create them and it is not just abstract element of contingency or historical luck that improve or deteriorate some state of affairs, it is
human rationality and irrationality, mentalities, habits, languages, destructives,
moeurs et manières as Tocqueville would put it. This is the reason why abstract
models of social behavior and historical explanation are of limited use in any
analysis of social change. In this article we seek to explore this type of theoretical reductivism on the example of two different neo-institutional approaches to
a social change.
Keywords: neo-institutionalism, reforms, transitional experience, capitalism.
Conventional wisdom of contemporary economics and political
science says that in order to successfully transform, every society has
to implement a well-known recipe – a preferable blend of political and
economic reforms. These reforms – often termed “structural” – aim
to introduce political (democratic) pluralism and free markets where
1 Research associate
aleksanov@gmail.com
2 This paper was prepared in the scope of the research project „Democratic and national
capacities of the political institutions of Serbia in the process of international integrations“
(179009), funded by the Ministry of education, science and technological development of
the Republic of Serbia.
89
neither is present, or where only one element exists. The recipe is not a
panacea, but a product of well corroborated insight, based on experience of many societies in various historical periods. It is confirmed,
economic freedoms bring growth and, when joined with political pluralism and firm institutions, pave the way for freer and richer society
of liberal-democratic sort. This Friedmanian wisdom, in line with the
logic of diminishing marginal utility, also says that every authoritarian,
albeit economically free country, in one point of time tends to transform into politically freer one. Today, this explanatory pattern tacitly
enjoys the status almost similar to one that natural laws enjoy in physics, particularly for social science benevolent to the idea of free markets.
As accumulated and firmly corroborated knowledge of “know-how”, it
seemingly represents simple solution and desirable model for each society aspiring to change.
In reality, however, this simple and elegant transitional remedy is
seldom fully and consistently implemented. The examples of various
eastern-European ex-communist countries (and not just them) well
document this.3 It seems that societies are resistant to simple cures. Or,
the cures are not so simple after all. It is than not surprising that one of
the most important preoccupation of contemporary political science
becomes attempt to understand strong “structural” resilience of many
(transitional) societies to such perceived reforms. This is also preoccupation and practical agenda of supportive politics and strategies for
developing countries of several international organizations such as the
IMF or the World Bank.
If salutary findings of economics, sociology and political science
converted into practical recommendations receive cold reality check,
than one should think of some other factors besides narrowly seen
economical (lack of institutions), sociological (group interests) and political ones (unwillingness of political elites), that can account for the
poor implementation of these measures. To acknowledge this would
be a necessary step in deepening our understanding of social change
(or lack of it). Most importantly, these considerations might lead to an
exploration of (political) rationality and the involvement of anthropological variable in the analysis of social changes. The exploration that is
3 Despite widespread opinion of social sciences that the post-socialist transition was from
the outset driven by the „neoliberal agenda“, the history of reforms and ideological
commitments of reformers in east-Europe form 1990 until present days does not validate
this presumption. Venelin Ganev makes well documented and elaborated case for this
scientifically „unintuitive” thesis (Ganev 2005).
90
Aleksandar Novaković
Neo-Institutionalism and the Success Story of Capitalism:
Two Different Approaches to Social Changet
today seldom present in dominantly neo-institutional analysis of these
matters.
Generally speaking, there are two main analytical attitudes regarding the ability of societies to transform. One, in which we can detect
pessimistic stance, rests on the thesis that the complexity of human
societies in itself – its history, political development, cultural factor,
“mentality”, etc. – makes it very difficult and uncertain to implement
even basic preferable “rules of the game”. Everything should be left to
evolution, to the slow and uncertain “march of history”. The premise is
that the most important thing for science is to understand change and
elements of changes, not to advocate it or to predict it. It is up to societies, governments, politicians and citizens to accept or reject scientific
– neo-institutional – findings. The other, optimistic and constructivist
in spirit, says that although every preferable social change is uncertain
and difficult undertaking, there are many examples throughout history
that show successful changes and that general practical recommendations are possible. The latter is more ideologically fueled, with strong
practical pretensions.
The vast majority of authors within the neo-institutional camp is
somewhere in-between these two poles, claiming, for example, that
the causes of prosperity and growth are detectable and well known
but nonetheless, that there are no definite recipes for successful social
change. Vivid example of this critically balanced, middle stance attitude, can be seen in Acemoglu and Robinson political science bestseller Why Nations Fail (Acemoglu and Robinson 2012). Of the latter kind
is, for example, recently published Renaissance for Reforms of Swedish authors Stefan Föster and Nima Sanandaji (Föster and Sanandaji
2014). Renaissance claims to be “the required companion” to Why Nations Fail, but it brings out much more to it. Here we will have a closer
look into differences of these two neo-institutional approaches to social
change presented in these books, in order to highlight some neuralgic
points within contemporary neo-institutional weltanschauung.
*
Compared to the neo-institutional theory of Douglas North that
focused on the importance of institutional ambient for social change
and growth4, Acemoglu & Robinson add far more weight to political
4 The theory stressed the importance of institutional change for growth (in the first place
firm protection of property rights and organizational improvements) and used this
91
factors, respectively. It can be said that politics in their institutional perspective comes before economics.5 Furthermore, they indicate a specific kind of political institutions – pluralistic in character which they
term “inclusive”. These are favorable to growth and social prosperity.
Opposite to them are “extractive” political institutions that benefit only
small group of people while being exploitative for society at large. This
addendum rightly relieves the authors (by their own opinion expressed
in the reply to Fukuyama6 and by the opinion of the author of this article) from Francis Fukuyama’s accusations of “making almost the same
point” that North, Wallis and Weingast made in one of their book, but
just with different words (Fukuyama 2012).
The pluralistic political component is not necessarily and – at least
not historically, associated with the type of representative democracy
familiar today. For example, for centuries British society embodied pluralistic social order (division of power and existence of various competing interests) although not democratic by today’s standards. “Pluralistic” here means, in the first instance, “positive” in terms of the capacity
of institutions to open space for social energies to emerge and interact,
although unintendedly and driven by self-interest, for the better of the
whole society. While using the term in this, broader sense of meaning, it seems as though the authors are relaying on the institutions of
contemporary democracy as paradigmatic for every sort of productive
social pluralism.7
Thus, the core meaning of Acemoglu’s and Robinson’s central conceptual dichotomy, namely, that of extractive and inclusive institutions, cannot be reduced solely to economic dimension as represented
through different notions in other neo-institutional writings. It aims to
encompass the whole diversity of social life and, rightly, it can be seen
insight for the historical interpretations of Glorious and Industrial Revolution (North
1991).
5 “This book will show that while economic institutions are critical for determining whether
a country is poor or prosperous, it is politics and political institutions that determine
what economic institutions a country has. Ultimately the good economic institutions
of the United States resulted from the political institutions that gradually emerged after
1619“ (Acemogly and Robinson 2012: 43).
6 See: „Response to Fukuyama’s Review” (Acemoglu and Robinson 2012b)..
7 It is not hard to detect in this adherence familiar political correctness of the present time
toward the model of representative democracy with universal suffrage. This adherence
cannot be found in „reactionary“ writings of old and contemporary „enemies“ of
democracy. See, for example, Hoppe (2001).
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Neo-Institutionalism and the Success Story of Capitalism:
Two Different Approaches to Social Changet
as their contribution to the neo-institutionalism. This naturally leads
to the central thesis of Why Nations Fail that only a complex combination of several factors (combination of inclusive economic and political
institutions) can determine nation’s destiny – prevent nations to fail or
helps nations to succeed. Factors such as unhampered markets, firm
rule of law that ensures predictability on every level of social organization, political pluralism (but not necessarily democracy) which enables
social participation and power sharing of various groups and interests,
and desirable levels of political centralization with the presence of powerful state apparatus in every part of the country.
The same pattern of success is not, and this is essential, bound to
geographical and cultural contingency or to the factor of human ignorance and fallibility. There is no room for covert racism of various cultural relativist’s well-wishers in this kind of analysis. “The history is not
destiny” the authors are revealing, while presenting different historical
experiences of once successful nations becoming “pariah” states and
vice versa, from once undeveloped – culturally, economically, historically – regions of the world, to the world’s leaders in prosperity.
The world of human affairs is thus seen as the world of constantly
spinning “virtuous” and “vicious” circles throughout history. Virtuous
circle represents preferable state of affairs in any society where inclusive institutions are firmly rooted. Vicious circle, on the other hand,
corresponds to what Robert Michels calls “the iron low of oligarchy”, a
condition where a society is destined only to periodic shift of oligarchic
elites, leaving otherwise promising countries in the condition of perpetual misery.8 It says that human factor itself, or to put it in Leninist
vocabulary “cadre issue”, does not mean much if specific institutions –
the extractive ones – are firmly rooted. The real changes in society are
not possible as long as changes within institutions are not allowed. The
logic of both mechanisms can be explained on psychological basis, as
a habit to keep present state of affairs or status quo in place as long as
possible. The only question becomes how to “break the mold”, preferably in the case of vicious circle.
8 Acemoglu & Robinsons exploit broader meaning of the metaphor (Acemoglu & Robinson
2012: 126) which Michels originally developed for representative democracy of western
countries (Michels 1966). They use it as a metaphor for every society regardless of its
democratic pedigree.
93
These vicious circles or molds could be broken with the help of what
the authors have labeled as “critical historical junctures”9 and small institutional differences like monopolized character of trade in Spain
compared to England in 17th century, which strengthened the power
and influence of British merchants. Combination of critical events and
small institutional differences and changes (that can often be detected
only retrospectively) can pave the way for more inclusive political and
economic settings.
Yet, the hallmark of successful, open and free economy is the presence of what, recalling Austrian economist Joseph Schumpeter, Acemoglu and Robinson call “creative destruction”: a process in which old
is replaced with new, a process of constant dynamism and innovation
that shake economic playfield provoking change of teams and making
actors of market game even more successful with the necessary consequence for some of them of leaving the game.
Furthermore, pluralistic political institutions are a counterpart to
the creative destruction in the sphere of economy, but the clear line
between these two dimensions cannot be drawn. Creative destruction,
where present, necessarily influences political order and vice versa. As
we have remarked at the beginning, economic freedom leads to the political one, but the creative destruction is necessary consequence of economic freedoms. Creative destruction is present only where economic
freedoms are secured. Again, the authors are stressing their commitment to the Fukuyamian ideal of political order, namely, western type
liberal democracy.
But, what about growth under extractive institutions? As demonstrated by ample historical evidence, growth is still possible under extractive institutions. And this fact has for long time been used as an
argument in favor of authoritarian concepts of societies from various
sides, left and right irrespectively. Even among enlightened western socialist camp there still exists an admiration for “Hitler’s economic miracle” of the thirties”,10 “economic success” of USSR and Deng Xiaoping’s
9 As were, for example, Black Death in 1346 that wiped out population of medieval Europe
thus causing the increase of the price of peasant’s labor, or opening of transatlantic trade
route in 17th century, or the process of European colonization, or Mao Zedong death in
1976... (Acemoglu & Robinson 2012).
10 For the economical “success” of Hitler’s economy see: Aly (2007).
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Neo-Institutionalism and the Success Story of Capitalism:
Two Different Approaches to Social Changet
reforms in China.11 But from the logic of arguments exposed in Why
Nations Fail, it follows that this kind of reasoning is without any foundation in economic science. For without technological innovation and
market dynamics, this artificially produced growth is in the long-term
unsustainable and is doomed to crumble, just as USSR did.12 So the
real issue becomes not whether growth under extractive institutions
is possible, since it obviously is, but why the obvious fact of long-term
unsustainability of such growth is neglected by many social scientists?
Summing up it can be said that probably the most valuable aspect
of this book is a respectable dose of caution the authors have demonstrated in escaping the “easy explanation” trap. This concerns perspectives of any society to transfer from extractive to inclusive social and
economic institutions. To reach such an ideal is difficult undertaking
and authors are very careful not to fall into mechanistic or routinized
vision of economic growth and story of success often connected with
the simplified version of neo-institutionalism. The central place in their
historical interpretations is given to the factor of historical contingency.
Whenever their interpretation becomes too promising and optimistic
they make one step back reminding us that large part of the world has
never succeeded in building inclusive institutions and has, as a consequence, been permanently entrapped in the vicious circle. Those that
managed to succeed, in one historical period or another, did it with the
confluence of many (fortunate) circumstances in one place at a time.
Still, there are many examples of success, and throughout the book
the authors are shifting from one side of the world to another, from
one historical period to another, listing – sometimes seemingly unnecessary and tiresome for the reader – countless examples of successful
stories and practices. But these examples and ready-made “know-how”
means little when we include in analysis a complex and uncertain ambient of countries such as Argentina, Nigeria or some Balkan states,
frozen into a process of never ending and ill-performed transition. It
11 Interestingly though, this admiration usually does not stretch enough to encompass the
example of Chilean kind of economic miracle under general Pinochet.
12 “…growth under extractive institutions differs in nature from growth brought forth
by inclusive institutions. Most important, it will be not sustained growth that requires
technological change, but rather growth based on existing technologies. The economic
trajectory of the Soviet Union provides a vivid illustration of how the authority and
incentives provided by the state can spearhead rapid economic growth under extractive
institutions and how this type of growth ultimately comes to an end and collapses”
(Acemoglu & Robinson 2012: 1). Authors think that same grim destiny is awaiting
China.
95
matters little, especially for the despondent and discouraged populations of these countries, even for their pro-reform oriented elites.
So what is the value of such neo-institutional analysis wrapped in
a sheet of contingency? Can it be that the most valuable aspect of the
book at the same time presents its greatest weakness? For contingency
thesis might be seen as just a theoretical safety mechanism for neoinstitutional explanation malfunction. Another way to admit – covertly
– that institutions are not, after all, everything that matters? If this is the
case, we should search for some other models of explanation that will
not hide the problem under the rug of irrefutable and metaphysical
concepts such as contingency. But before making some indication in
what direction our search should lead, we will analyze another example
of neo-institutional approach to institutional changes.
*
In contrast to this cautious attempt of making a case for neoliberal
reforms, Fölster and Sanandaji in their book Renaissance for Reforms
take a more aggressive and optimistic attitude towards the ability of societies to implement successful reforms. Not only do they too acknowledge the importance of some basic economic institutions for growth,
they also put forward bold thesis that reforms pay off not just to society
in general, but for the reformers too. In a way, their book presents a
completion of unfinished work of Johnn Munkhamar and confirmation of his thesis that “reformist politicians can not only be motivated
by altruistic reasons, but also by self-interest” (Föster and Sanandaji
2014: 13).
One of the first lessons one learns from the accumulated transitional experience is that the political life of reformers or prominent actors
of painful and long-term oriented reforms is very short and personally
unprofitable. Precisely this thesis, or “myth”, is subject to the authors’
rebuttal. Surprisingly, the counter-argumentation is built on a comparative research on 29 OECD countries, in fact mostly on developed
western societies (Fölster and Sanandaji, 2014, 13). However, general observations and conclusions are not limited just to them and the
analysis takes into account also countries such as Argentina, Mexico,
Venezuela, Zimbabwe and other countries of interest for the analysis.
The first thing that a reader might try to understand, especially one
familiar with the thesis of the ill-fated destiny of reformers, is why the
primary analysis is focused on the developed countries. This question
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seems to be justified since the thesis of gloomy destiny of genuine reformers is – in the first instance – related to the politicologist discourse
of post-socialist transitions. It has nothing to do with practice of reforms in developed western countries that have never experienced central planned economy and socialist way of life.
But the authors are not giving the answer to this question. Instead,
they are exposing another interesting thesis. Namely, that the world
is witnessing a “dramatic shift towards growth-oriented governance”
which means in other words that many countries are now implementing free-market Friedmanian type of reforms. This is corroborated by
the World Bank’s Ease of Doing Business ranking index which shows
6% average improvement of business climate from 2006-2011. The
highest achievement comes from non-EU European countries and
South Africa region. Surprisingly, explanation of such course of events
is not to be found in forced reaction of the countries to the financial
and economic crises of 2008, but to the spread of the experiences and
“know-how” of successful countries facilitated by the media of globalized world. It seems that the authors are firmly convinced in the power
of knowledge transfer and information spreading as universal means
for changing societies.
This optimistic standpoint is based on several factors. Beside
abovementioned world climate change regarding reforms, the crucial
evidence that supports optimistic view they find in the analysis of the
reformers and the roles of the ideologies in contemporary world of politics. The main finding of the analysis presents very interesting thesis
of the interconnection of market reforms and reelection of centre-left
governments.
The analysis included 93 periods of governments of 29 developed
OECD countries (excluding Chile, Mexico and Turkey due to low development, and Switzerland and Israel due to political peculiarities) in
the period from 1995 to the present. The method used is binary probit
model (winning or losing election of the parities of the same political
orientation) based on the findings of The Heritage Index of Economic
Freedoms and with special focus on unemployment rate during the periods of entering and leaving the offices.
What is interesting in their analysis is that in the first phase of examination, when generally comparing political orientation of parties and
election results nothing was surprising: “After their first terms, left gov97
ernments have been less likely to be re-elected than right governments.
A low unemployment rate in the year of re-election entails a higher
probability of re-election” (Fölster and Sanandaji 2014: 35). But when
focusing only on pro-reform political parties, we detect two interesting
findings. First, centre-left reform oriented parties have as a rule been
re-elected. And, second, the level of reforms` achievements (which is
indicated by the economic index score) shows that more reforms are
performed by center-left oriented parties than by center-right political
parties. There is a strong correlation between levels of economic freedom and reelection of centre-left governments: more reforms mean to
centre-left parties’ higher possibility of reelection. The same does not
apply in the case of centre-right governments (Fölster and Sanandaji
2014: 35).
This curious finding is explained in the following manner: “Centreleft governments which increase the level of economic freedom can attract support from centrists and even from right-leaning voters. Most
voters who endorse market reforms tend to support centre-right governments. This means that the opportunities for centre-right governments to broaden their electoral support by market reforms are limited, while left-leaning parties who choose to deregulate and decrease
taxes may be doing so attracting the attention of the typical centre-right
voter” (Fölster and Sanandaji 2014: 40). Summing up the authors conclude that “Only Nixon can go to China”.
The additional factor that can account for this strange political behavior – strange in the sense of the usual image of commitments of
political actors to the political ideologies – is the level of political rationality present both among electorate and parties in their assessments of
necessity of reforms. The authors are giving a vivid example of Danish
social democrats who rejected the high fueled ideological rhetoric and
embraced pro-market reforms. There is also a case of European flagship of social democracy, namely that of Sweden, where pro-market
reforms have been implemented for many years.13 Other better known
examples of diminishing significance of ideological orientation in the
world of politics are those of famous “Thatcherism” of Tony Blair and
New Labour in the nineties or “neoliberal” reforms of Australian so13 Although many still think that Sweden is European bastion of socialism. On the Swedish
experience of socialism see: Sanandaji (2012).
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cial-democrats Bob Hawk and Paul Kiting that stretched for decades,
or Canadian pro-market reforms of Jean Chrétien and Paul Martin.
The key explanatory variables that Sanandaji and Fölster use in order to explain new tide of world’s pro-market reforms are diminishing
role of ideologies and ideological discourse among the political parties in highly developed countries and increase of demand for sound
and economically responsible policies within politically highly rational
electorate.
Through the investigation of what they call “reform threshold” (that
is, a degree of responsiveness of a constituency to the imperatives of reforms) they found that the countries with lower reform threshold (that
is, the countries with richer experience in past successful reforms) will
fare better compared to those with higher reform threshold and without such experience. The case of Ireland is illuminating in this regard.
Former reform experiences helped Ireland to successfully adapt to the
situation after the crisis in 2008 when it entered into a drastic economic
turmoil. Also, northern European countries that hold the lowest reform
threshold are an example of this responsiveness to the imperatives of
reforming. But it is quite a different case with problematic European
countries, such as Spain, Italy or Greece. That leads authors to state that
apart from experience of successful reforms, some other factors, such
as the spirit of solidarity, are also required for lowering reform threshold (Fölster and Sanandaji 2014: 69).
This analysis seems a bit oversimplified. It says that the countries
that had already experienced successful reforms in the past are more
prone to accept the new ones. Besides the odor of triviality present here,
we cannot see how this can be related to those countries without such
experiences. But the authors (optimistically) presupposed just that.
This explanation can hardly satisfy all those countries and reformers
that have never had successful reforms but are still seeking to achieve
them. This simple weakness in authors line of argumentation shows
that the paradigm of successful reforms in developed countries with
high degree of political rationality of political elites and electorate cannot be adequate theoretical tool for general explanation why nations
fail or succeed, to use Acemoglu and Robinson words, and even less to
advocate – which is of more importance for the authors of this book –
particular institutional changes for the troubled societies.
99
Announced as a “companion” to Why Nations Fail, Renaissance for
Reforms demonstrated higher ambition than its predecessor. What the
authors of Why Nations Fail refrained from, the authors of Renaissance
rush impatiently to. They boldly throw historical contingency thesis
into the dustbin of analysis. They give specific recommendation for
all would-be reformist governments. This ambition rests on conviction that the fruits of market liberalization (although often in practice
very modest – the fact not mentioned in this book) are so obvious and
empirically corroborated that it is almost impossible that any rational political actor would not appreciate them. This is a paradigmatic
sort of neo-institutional reasoning, at least as a premise, and one must
admit very honest, but also a naïve one. This is obvious in simplified
understanding of human behavior and rationality expressed in their
wonderment how anybody can (having in mind “the fact” that global
renaissance of reforms is taking place right now) tolerate irresponsible
rulers: “…it would actually be quite surprising if people continued to
tolerate leaders and rulers whose policies maintain a status quo of poverty” (Fölster and Sanandaji, 2014: 20). But people do so, constantly.
There are eight recommendations provided in this book, which
comprise all important elements already mentioned. These are learning from research and experience, asking the right questions, introducing reforms that can be evaluated, creating evaluating institutions, coupling good reforms, starting with small-scale changes, partnership with
opposition, and keeping up the good work (Fölster and Sanandaji 2014:
105). These recommendations certainly present useful guidebook for
any government committed to reforms. Not that they should not abide
to it. But will countries of accumulated negative reform experience
such as Argentina, Greece, or Serbia abide to them? In its manner, this
guidebook resembles the “know-how” of popular affirmative psychology books; it assumes ideal situation that lacks complexity of real life
in which numerous factors – social, political, cultural, economic etc.
– emerge and confluence. It assumes highly ordered and rational political situation and these are precisely the elements missing from any
country in need of structural reforms.
*
It is difficult not to admit that neo-institutional understanding of
society sounds compelling. Institutions are certainly grounding factors
of every society in every historical period. Their importance is undisputable. Even anarchical social organization includes institutions, al100
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though unhampered ones and lacking exterior involuntary coercion
of the state. Furthermore, accumulated historical experience has convincingly demonstrated that societies with a higher degree of economic
freedoms, firmly secured institution of property rights and sound rule
of law will eventually bring growth and prosperity. The history of unprecedented achievements of Industrial Revolution and, consequently,
record growth that world has experienced since then, with population
boom and tenfold and even larger increase in living standard, is the
story that is constantly repeated by most prominent economists and
social scientists. However, this true story telling has traditionally had
small impact on policy makers, and the ordinary understanding of
economy.
This same historical experience, particularly one that followed after
the demise of classical liberalism at the end of nineteen century14 has
demonstrated, also convincingly, that high state regulation and planning of economic life brings stagnation and decline to every society
that adhered to this strategy. The final result of the famous socialist
calculation debate that started at the beginning of XX century theoretically sealed the fate of the possibility of economic calculation under
socialism (Steele 1992). But still, this scientific finding did not prevent
a large part of the world from entering into some form of socialism in
the same period of time.
This means that in our explanatory models of social behavior and
the institutional changes we often neglect some important variables
that can account for a great deviation in accepting these “self-evident”
truths and experiences. Thus, any analysis of social change based on
importance of various types of institutions should try to avoid reductivist vision of human behavior. It should try not to be built solely on the
idea of subject as rational (self-interest oriented) actor, as it is presented
in the game theory of neo-institutionalism, or in economics in general
(Caplan 2007). Nor should it substitute logic of other fields of life, such
as politics for the utility maximization logic of economics. We should
not thus regard political actors accordingly, as agents driven just by the
desire to improve their own position – or, consequently, and if rational
– condition of the population in general. Instead, we should add in our
analysis those less predictable but still existing elements of social life, or
life of individual, like for example, those virtues of which Deidre Mc14 For the process see: Mises & Greaves (2005).
101
closkey recently wrote (Mccloskey 2007). With these other elements of
human behavior we can better explain some historical events or present situation in some transitional countries.
The central weakness of every institutionalism is its attempt to elevate the significance of formal and informal institutions as some exterior self-acting mechanism, productive or unproductive ones, extractive
or inclusive ones, above the factors that made them such. Those other
factors are paired and merged with them. They create them and it is not
just abstract element of contingency or historical luck that improve or
deteriorate some state of affairs, it is human rationality and irrationality, mentalities, habits, languages, destructives, moeurs et manières as
Tocqueville would put it. This is the reason why abstract models of social behavior and historical explanation are of limited use in our analysis of social change.
To put it differently, economic science says, for example, that capitalism is comparatively superior to any of its alternatives. Historical
course of events confirms this as well as Index of Economic Freedoms
of Heritage foundation, Doing Business of World Bank, or any other
day to day or yearly analysis and indexes of economic data. But these
rational and objective insights would, as a rule, hardly provoke individuals or groups, politicians or ordinary citizens, smaller communities
or whole countries to embrace this knowledge and act in accordance
to it. This is due to the fact that our behavior is not solely managed by
the regime of truth or untruth, or by scientific findings, nor it is managed by best practical recommendations confirmed by experience. In a
word, learning from the experiences and best practices is often not primary motivational factor for individuals and societies in general, nor
is it complying with the rational and prudent insights of economy or
other social sciences.
When recognizing undisputed superiority of capitalism, Josef
Schumpeter remarked that this means almost nothing when one has
in mind deeply rooted tendency to short-term reasoning of ordinary
people.15 Ironically enough, it is the very human nature, that liberal
15 “In order to identify himself with the capitalist system, the unemployed of today would
have completely to forget his personal fate and the politician of today his personal
ambition. The long-run interests of society are so entirely lodged with the upper strata of
bourgeois society that it is perfectly natural for people to look upon them as the interests
of that class only. For the masses, it is the short-run view that counts. Like Louis XV, they
feel après nous le déluge, and from the standpoint of individualist utilitarianism they are
of course being perfectly rational if they feel like that…“ (Schumpeter 1994: 145).
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Two Different Approaches to Social Changet
economists and social scientists so often refer to, that undermines their
main argument, and in fact brings into question the sole premise of the
notion of human nature which they hold.
*
All this does not imply that we should not, particularly in the sphere
of policy making, adhere to the best known models or practices of social organization. We should and we must tell and retell a story of success of capitalism, not just because of its economic accomplishments
and general usefulness, but above all its moral superiority – to put it in
Randian perspective. To these we are bound by historical evidence of
devastations of various kinds of destructive collectivisms that emerged
on the ruins of the institutions that underpin every capitalist society.
This is also the primary responsibility for social scientists as truth seekers – as Karl Popper would say – and not the least important moral
beings – to put it in Kantian perspective. But saying this does not mean
not to recognize some inherent flaws in reductionist vision of social
behavior, technocratic notion of social change and naïve story of successful social transformations present in world of dominant behaviorist, neo-institutional or mainstream political science and economy.
Bibliography:
Acemoglu, D. & Robinson, J. (2012) Why Nations Fail - The Origins of Power,
Prosperity and Poverty. New York: Crown Publishers.
Acemoglu, D., & Robinson, J. (2012a) “Response to Fukuyama’s Review”.
Why Nations Fail [online]. Available at: http://whynationsfail.com/
blog/2012/4/30/response-to-fukuyamas-review.html [Accessed 9 June
2014].
Aly, G. (2007) Hitler’s beneficiaries: Plunder, racial war, and the Nazi welfare
state. New York: Metropolitan.
Caplan, B. (2007) The myth of the rational voter: Why democracies choose bad
policies. Princeton: Princeton University Press.
Douglass C., N. (1991) “Institutions”. Journal of Economic Perspectives, 5(1): 97112.
Föster, S. & Sanandaji, N. (2014) Renaissance for Reforms. London: IEA &
Timbro.
Fukuyama, F. (2012) Acemoglu and Robinson on Why Nations Fail. The American Interest [online]. Available at: http://www.the-american-interest.
com/fukuyama/2012/03/26/acemoglu-and-robinson-on-why-nationsfail/ [Accessed 10 June 2014].
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Ganev, V. (2005) “The ‘Triumph of Neoliberalism’ Reconsidered: Critical Remarks on Ideas-Centered Analyses of Political and Economic Change
in Post-Communism”. East European Politics and Societies, 19(3): 343378.
Hoppe, H. (2001) Democracy - The God That Failed: The Economics, Politics of
Monarchy, Democracy, and Natural Order. Rutgers [NJ]:Transaction.
McCloskey, D. (2007) The bourgeois virtues: Ethics for an age of commerce.
Chicago: University of Chicago Press.
Michels, R. & Paul, E. (1968) Political parties: A sociological study of the oligarchical tendencies of modern democracy (2nd Ed.). New York: Free Press.
Mises, L. & Greaves, B. (2005) Liberalism the classical tradition. Indianapolis:
Liberty Fund.
Sanandaji, N. (2012) “The surprising ingredients of Swedish success – free markets and social cohesion”. IEA Discussion Paper, 41.
Schumpeter, J. (1994) Capitalism, Socialism and Democracy. London and New
York: Rutledge.
Steele, D. (1992) From Marx to Mises: Post-capitalist society and the challenge of
economic calculation. La Salle [Ill.]: Open Court.
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Institute for Political Studies
UDC 35.071+342.9(497.11:4-672EU)
Manuscript received: 12.09.2014.
Accepted for publishing: 21.10.2014.
Original scientific paper
Serbian Political Thought
No. 2/2014,
Year Vl, Vol. 10
pp. 105-131
Dejan Milenković1
Faculty of Political Sciences, Belgrade
Serbian Public Administration Reform in
the Light of the European Administrative
Space Principles2
Abstract
European integration process influences to the harmonization of different
areas of law. The concept of the European Administrative Space in the European
Union has been developing for the last thirty years. It includes the set of minimum common principles and standards governing the organization, activities
and functioning of administrative bodies in the Member States and potential
candidates as well. This includes significant changes and administrative reform
in the process of Serbia’s membership negotiations. Serbian administrative capacities have to be in compliance with the standards of the European Administrative Space with purpose that in the future Serbia or its administration can
successfully implement the regulations adopted by the Union. The process of
administrative reform in Serbia is carrying out for ten years. In different cycles
this process was faster or slower. Comparative analysis of the European administrative space standards and the process of administrative reform in Serbia indicate that Serbia, perhaps not fast enough, is increasingly adapting to these
standards.
Keywords: European Administrative Space, public administration, Strategy
of the Public Administration Reform, National Programme for Integration of Republic of Serbia into European Union.
1 Associate professor
dejan.milenkovic@fpn.bg.ac.rs
2 This paper is a result of the scientific research project entitled “Political Identity of Serbia
in the Local and Global Context“, implemented by the University of Belgrade - Facultx of
Political Sciences (reference number 179076).
105
Introduction - General Review of the European Administrative
Principles Creation
The term the “European administrative space” (EAS) has been used
to describe an increasing convergence of administrations and administrative practices at the EU level and various Member States’ administration with the “common European model” (Olsen 2003: 506). At the first
glance, public administration has always been an internal issue of the
Member States. As the European Union itself has no “administration”,
national public administrations have to implement the directives and
other regulations of the European Union so that European citizens can
enjoy the rights guaranteed by the Agreements of the EU, no matter in
which country they live. This fact justifies the interest of the European
Union to ensure that each national administration has a comparatively
good level of quality and professionalism and to be interested in the
administrative capacities of its Member States. On the other hand,
the EU legislation has a big impact on the economic and social conditions in the Member States and thus their economic competitiveness.
Considering that the national public administration and judiciary are
guarantees for its implementation, the interest of the Member States for
the public administration in other Member States has increased over
time. This interest in the administrative capacities and judiciary in the
European Union is even greater with the respect to the future Member States (Cardona 2009: 1). Nowadays, numerous meetings at the EU
level are dedicated to the “standardization of a common administrative
clock of European governance” (Ekengren 1997:79).
Often it is claimed, that the European Union as a community based
on the law, could be more precisely called the community based on
the administrative law. Since the establishment of the European Community and the European Union, it is nothing else but the Community
of the Administrative Law. At the beginning unwillingly and under the
pressure of the comparative law, through the Union it arose from the
frame of the national isolation, which exceeded the former narrow horizons and opened itself significant prospect for future development
(Schwarze 1992: 3-4).
As a support to this thesis is the fact that even in the Treaty of Rome
from 1957 four freedoms were determined: free movement of goods,
services, people and capital, which meant that national public administrations of EU Member States must work in such a way to ensure
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Dejan Milenković
Serbian Public Administration Reform in the Light of the
European Administrative Space Principlest
effective implementation of these freedoms in all aspects. Even each
Member State has complete freedom to decide on ways and means to
achieve the objectives outlined in the agreements, the EU has developed common principles and tools, which is particularly noticeable
within the principle of administrative law and a little less in the very
organizational structure of the public administration of the Member
States, where there are still numerous and different state administration
organs, as well as other institutions and bodies.
By establishment of the Single European Market gradually changed
the character of administrative activities. National administrations are
becoming an important factor of encouraging and development of
economy and protection of human rights. Today, good governance,
economic development and social cohesion are among the basic components of democratic development of modern Europe and its administrative space. In accordance with tradition, in European countries,
state administration becomes the guarantee of the welfare state that
provides protection of civil rights, peace and order, social and political
stability of the society (Kavran, Vukašinović 2004: 11).
Although indirect, the link between the accession of new states into
the European Union and public administration reform is real. Member
States have to be able to implement public policy and EU legislation in
their countries. To make this, they have to have an administration that
functions well. This is a very important requirement for the EU as a
whole and for individual Member States. As a country is approaching
to the accession to the EU, the connection between European integration and public administration reform seems all stronger. It is important that the European Commission put great accent in its opinion on
the ability of administrations of the Member States to implement a system of European legislation (acquis communautaire).3
1. The Role and Importance of the European Court of Justice in the
establishment and creation of the Principles of EAS
Development of the EAS had been evolutionary and fluid. (Hofmann, C.H. 2008: 662). Legislative activity of the European institutions
is an important source of the common European administrative law,
3 Compare: SIGMA paper No. 23: Preparing Public Administrations for the European
Administrative Space, OECD, 1998.
107
which is implemented as national law in the EU Member States. This
European administrative law is mostly special administrative law and
it refers to the number of sectors. However, there is a horizontal legislation, such as legislation that provides public procurement or public
systems of internal financial control. Another source of administrative approach is the constant interaction between civil servants of
the Member States and civil servants of the European Commission,
which fosters a unique understanding on how to implement EU policies and legislation at national level (Cardona 2009: 4).
However, both primary and secondary sources of the EU legislation are combination and mixture of continental and precedent law,
and their characteristics and nuances are particularly evident in the
practice of the European Court of Justice, also as a main source of the
administrative law of the European Union. Before this court, among
other things, can be initiate: procedure for determining the legality
of acts of the institutions of the Union, then the procedure that determines whether the Member States meet their obligations under
the legislation of the Union, as well as the procedure for obtaining
a prior opinion of the Court as to ensure uniform interpretation of
the Union legislation and establish cooperation with national courts
(Kavran, Vukašinović 2004: 19).
As the European Union does not have its own military or police,
nor has a direct means of enforcing its authorities, it must largely rely
on the Member States. Therefore the central judicial power embodied
in the European Court of Justice is relevant to the integration process,
because it ensures the respect of such rules in the interpretation and
application of the sources of the Union law.
The European Court of Justice in its judgments has defined a
number of principles of administrative-law nature referring to the
general principles common to the member states that they have to
accept within its legal system when implement EU law (Schwarze
1992: 10-30). This means that the Court’s judgments do not match
with the particular country’s legal system, but its legal practice in fact
present a set of influences that come from practically all the EU countries. By applying the method of comparing individual national laws,
the Court found a number of general principles of administrative law
that are crucial to build the Community administrative law. These
principles are: reliability and predictability (legal certainty), openness
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Dejan Milenković
Serbian Public Administration Reform in the Light of the
European Administrative Space Principlest
and transparency, accountability and efficiency and effectiveness
(Milenković 2013: 314-315).
Reliability and predictability is a principle that stems from the
rule of law. It consists of a group of principles, such as principles of
legality, proportionality, professional integrity, non-discrimination,
procedural justice and other. According to the principle of legality,
obligation of the administration is to act in accordance with the law
(legally), to counter the arbitrary decision-making and that the decision brought is in accordance with previous two principles, to be socially justified (legitimate). Thus, the principle of legality is necessary
connected with the principle of proportionality, which implies that
the administration may impose obligations to citizens only to the extent necessary to achieve the purpose of these measures, namely the
measures taken by the state must be proportionate to the objectives
which need to be achieved. The origin of the principle of proportionality is related to (dis)trust of citizens towards the discretion of the
authority of the state and for their desire to ensure their fundamental
human rights. The principle of proportionality is thus considered as
subjective form of the principle of the rule of law, expressed in the
request that the state activity is not only legal but fair (legitimate or
socially justified). The principle of reliability and predictability supports the principle of professional integrity in public administration
(Lilić, Golubović 2011: 72-74). It refers to the impartial and independent work of the administration. Conflict of interests and unequal
treatment of clients, personal affinities in decision-making, accepting
bribes, great desire for advancement, presents some of the reasons
which threaten the professional and independent work of civil servants. Principle of procedural justice that guarantees impartial implementation of the law, respect of parties and its dignity should be also
mentioned (Rabrenović 2002: 160-161).
The principle of openness and transparency in a relation to the
work of administration means that everyone who is connected to the
administrative acting should be familiar with the basics of such acting. At first, this principle meant a duty to inform the party with all
the factual and legal facts relevant to the decision making. This principle has been improved significantly with the establishment of the
right to free access to information as everyone’s right to seek and receive relevant information from the holders of state authority which
109
is of public interest in order to effectively provide access in the work
and actions of the public authorities (Milenković 2010: 35)
Principle of accountability means that each administration organ
must be responsible for its actions to other administrative, legislative or judicial authorities. This principle, through development of
comparative law is expanding and starts to include external control of
the administration by independent and autonomous bodies like the
Ombudsman, Commissioner for Information, Committee for resolving the conflicts of interest, Audit institution and others. Establishing
clear procedures for effectively performing duties and ensuring compliance with the rules of procedure and the use of public authority in
accordance with the law, form the basis of all forms of control, and
ensure the principle of accountability of the administration (Kavran,
Vukašinović 2004: 23).
Principles of efficiency and effectiveness are typical principles of
management. With the principle of efficiency is achieving the balance
between invested sources and accomplished results, while the principle
of effectiveness refers to the successful achievement of the objectives of
the administration in resolving problems of public interest, and is mainly related to the analysis and evaluation of administrative policies.
All these mentioned principles are a reflection of the community
law, comparative law of the Member States, but of the realization of
strategies and transition of administrative systems as well, not only
in the member states but also in many other countries of the world.
However, for the countries in transition in Europe they are of special
importance, because the admission of the new states into the EU is not
possible without the custom modern public administration, because
such a state would not have the capacity to meet the current demands
of the Union. (Rabrenović 1998: 227). Thus, modern administration
has become a requirement for the membership in the EU.
2. The Importance of the EAS Principles implementation for
admission to the European Union
The process of European integration influences on the harmonization of different areas of law. Harmonization of the public law has always been complex. The concept of the European administrative space,
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which was created and developed in the past thirty years, as a set of
minimum common principles and standards governing the organization, operation and functioning of the administration organs also implies a significant changes and administrative reforms in the process
of the accession of Serbia to the EU membership. This is particularly
certain after Serbia has signed the Stabilization and Association Agreement (SAA) in February 2008, which was later ratified, and after Serbia
submitted its application for membership in the European Union on
22 December 2009 and the European Commission (EC) adopted the
decision on forwarding it to the EU on 25 October 2010.
As in the European countries different ways to organize the state
exists, the issue of harmonization of the state administrations was specific. Today, the process of harmonization of the administrations in Europe is primarily viewed through the prism of the already mentioned
general principles of the European administrative space, regardless of
whether it is a constitutional monarchy with the administration on two
levels as is the case in Denmark, or the centralized unitary state without region in Ireland, centralized deconsecrated state in France, a unitary state with the autonomy of nationalities and regions in Spain, or
a federal state with a high autonomy of states as in Germany. A strong
interaction between EU legislation and national administrations of the
Member States, led to changes in national administrative systems and
encouraged the process of their harmonization. For the Union the way
of organizing the national administrative systems is not important, but
the effective implementation of relevant provisions of Community legislation, or the legislation of the European Union.
Even in 1993, the Union has defined the Copenhagen criteria for
the accession of the Central and Eastern European countries. Although
the development of administrative systems is not directly mentioned,
the ability to accept the obligations deriving from the EU membership,
and the possibility of implementation of the Union legislation set forth
in the Copenhagen criteria, concerns the very ability of states to accept
“the achievements of the community” which mostly depends on the
administrative capacities of state administration.4
In 1995 in Madrid, continuing this process, the EU Council of Ministers noted that the integration of Central and Eastern Europe countries requires the adjustment of their administrative systems, but for
4 Compare: The Copenhagen Criteria, Agenda 2000, for stronger and wider Union.
Document drawn up on the basis of COM (97) 2000. European Commission.
111
this process it is not enough for European legislation to be only appropriately transposed to the national level, but to be effectively implemented in the work of the state administration and courts. The Criteria
of the Copenhagen and Madrid require professional state administration, free from undue politicization, based on merits, which acting in
accordance with acceptable standards of integrity. They also require a
clear division between politics and administration. Finally, it also takes
healthy and transparent decision-making structures and procedures
throughout the administration. The Council then prepared a document entitled White Paper for assisting in creation and development of
institutions and legislation necessary for the admission into the Union.
In the Agenda 2000, a document that the European Commission presented the 1997, it was declared that when giving an opinion on the
submitted applications for the membership, the Commission should
pay particular attention to the public administration and administrative capacities of the candidate countries (Milenković 2013: 319)
3. SIGMA Programme and the Assessment of the Administrative
Capacities
New quality in the assessment of administrative capacities of candidate countries for membership in the European Union gave the Sigma
Programme as a part of the Organization for Economic Co-operation
and Development (OECD) Programme, financed from the PHARE
Programme of the European Union. So, Sigma is joint initiative of the
European Union and the OECD. Sigma was launched in 1992 and it
is functioning within the OECD Department for Public Management,
which provides information and expert analysis on public management for decision makers and facilitate contracting and exchange of
experiences among public sector managers.
Sigma Programme provides access to a network of experienced public administrators, comparative information and technical solutions to
the beneficiary countries. SIGMA objectives are as follows:
-- to assist beneficiary countries in their quest for good administration
with the aim
-- to improve administrative efficiency and to promote adherence of
public sector staff to the democratic values, ethics and respect for
the rule of law;
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-- to assist in building of its own skills at the level of the central
government to face the challenges of internationalization and
integration plans of the European Union and
-- to support the initiatives of the European Union and other donors to
support beneficiary countries in the public administration reform
and contribute the coordination of donor activities.
In the entire work, the initiative places a high priority to facilitating
cooperation among governments. It includes providing logistical support to the creation of a networks of experts involved in the public administration in Central and Eastern Europe, as well as their connecting
with collogues from other countries. Sigma now operates and provides
assistance in four areas: legal framework, civil service and justice system, internal financial control and external control, procurement and
decision-making process. They include the following sectors: administrative law, civil service system and strengthening of the public integrity, financial management, internal financial control and the main
control and decision-making process and coordination, management
and administrative environment and business.5
Standards of development of public administration established by
the SIGMA Programme in the late nineties of the 20th century are still
used as a basis for assessing of the capacities of the public administration
in the Annual Reports of the European Commission. For that reason
SIGMA Programme had an enormous importance in the assessment of
administrative capacities of countries that became full members of the
European Union in the last two “rounds” of the enlargement process,
namely in 2004 and 2007.6 In 2010, SIGMA Programme, within the
pre-accession aid instruments of the European Union worked in three
candidate countries for membership in the European Union (Croatia,
the former Yugoslav Republic of Macedonia and Turkey), and with five
countries (territories) of potential candidates for EU membership (Albania, Bosnia and Herzegovina, Montenegro, Serbia and Kosovo), so it
is now one of the main partners of the Directorate General for Enlargement of the European Commission.7
5 More information available on the SIGMA website: http://www.sigmaweb.org
6 Several materials and papers published by SIGMA in the period 1998 to 2004. can be
found in the Serbian language in the publication: Group of Authors, Sigma Papers: 23, 26,
27, 31, 35, (translation Milena Mihajlović), European Movement in Serbia, the Republic
of Serbia, Government, European Integration Office, Belgrade, 2006).
7 More information on current SIGMA programmes available on the SIGMA website:
http://www.sigmaweb.org
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Even in 1998 SIGMA Programme, by following a period of transition in the Central and Eastern Europe countries which became members of the EU in 2004 and 2007 in terms of meeting the standards of
the public administration and development of administrative capacities, pointed out on the experiences of different countries which shown
that administrative reform is process that requires time. It requires
material and human resources which in these countries are often very
lacking. This process implies changes in attitudes and cultural transformation that can be achieved only gradually, and although even the
administrative reform itself primarily is a technical process, it has important political consequences. It is therefore necessary for it to provide
three key preconditions (Fournier 1998: 52).
The first is existence of political will. Administrative reform is an
ungrateful job and faces with many obstacles and its benefits become
visible only over the time. To be completed it must have a strong and
sustained support of politicians. This in turn means that it is the best
that the authority competent for planning and monitoring the reform
to be placed as close as possible to the Government, and on this issue
a consensus to protect reforms even partially from a political changes
must be seek.
The second precondition is that the planning and implementation of administrative reform be approached in a comprehensive
manner. Ten separate reforms, however well planed, are not equal
with overall reform unless they are based on the same principles
and performed in a coordinated way. General Strategy is necessary.
Regardless of the quality of available international assistance, comprehensive vision can only come from the country concerned. Each
country has to establish organizations and processes that will enable
it to develop and pursue its own vision. Only with such a vision, the
measures that should be implemented as part of various programs
would be coordinated and complementary and not incompatible,
what in some cases occurred in the process of accession of certain
countries in the EU in 2004 and 2007.
The third precondition is that the eventual risks if some of the steps
has been skipped, should be carefully considered. Thus, for example,
some of the EU member states have experimented with entrusting
the management of public administration through contracting or
with the introduction of market mechanisms that adding flexibility to
the traditional rules of their state administrations. But, even they are
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productive in the countries that already have a capable administrative
system, in the countries in transition where this system has still concluding, they may even have far-reaching adverse consequences.
4. The European Integration Process, the EAS Standards and the
Reform of Public Administration in the Republic of Serbia
In continuation of this paper, the process of public administration
reform in the Republic of Serbia in the context of the European integration and the EAS standards has been analyzed. This process is analyzed
within three different time-specific phases: the first phase covers the
period from the beginning of the democratic transition until the SAA
was signed (2000-2008); second phase covers the period after the SAA
was signed until its entry into force (2009-2013) and the third phase
covers the period from the SAA entry into force until the present day
(2013-2014).
First phase of the Public Administration Reform in Serbia
(2001-2008)
Transformation or the administration reform – administration activities and administrative organization on modern bases harmonized
with the EAS standards has become priority task of Serbia in the process
of transition, after democratic changes that occurred in 2000, and since
the administration has got a key role in ensuring the conditions for accession to the European Union, the smooth functioning of the market
economy model and the respect and protection of human rights.
State Administration Reform Strategy in Serbia was adopted by the
Serbian Government in October 2004. An integral part of this document was the Action Plan for its implementation within the period
from 2004 until 2008. The Strategy included only the state administration as a particular organizational structure within the executive authority at the central level.
The Strategy is mainly based on legally - legalistic strategy in combination with organizational - procedural and participative strategy. The
strategy partly involves elements of the strategic direction of the new
system of governance (“New Public Management”).
115
The main objectives of the 2004 Strategy which Serbia sought
through the public administration reform are: building a democratic
state based on the rule of law, accountability, publicity, efficiency and
effectiveness and creation of the public administration that is directed
to citizens, capable to provide high level of services at reasonable costs
to citizens and private sector. Objectives set up in this respect, are
similar to the basic objectives of administration reform in the national systems of other countries. In order to stimulate these objectives,
the Government of Serbia committed itself to the implementation of
reform which will be guided by the following basic principles: decentralization, depolitiization, professionalization, rationalization and
modernization.8
From the legally-legalistic point of view, the Strategy as a part of the
State Administration Reform Strategy, pointed out to the need of the reform of the legislative framework, which should create a legal basis for
the implementation and creation of mentioned principles of the EAS. It
is indicated as an initial step towards systemic changes, and permanent
monitoring of the effects of the laws implementation, with active participation of all relevant social subjects, should be the basic mechanism
that provides the dynamics of the reform process and its harmonization with real needs, with the elimination of identified weaknesses and
deficiencies. Specifically, according to the Strategy, the reform of the
legislative framework in the field of state administration included the
adoption of laws that will be the legal framework for the functional and
organizational reform of the state public administration based on strategic principles. This meant the adoption of a set of laws and related
regulations governing the basis of Serbian state administration, such as
the new Law on State Administration and the Law on Civil Servants.
Simultaneously with these laws, a part of the new legislative framework
should be consisted of the laws which are governing the procedural actions of the state administration and control of the legality and regularity of their work - namely the Law on Administrative Procedure, Law
on Administrative Disputes, the Law on Ombudsman, etc. At certain
points in the Strategy is also stated that is necessary to introduce special
regulatory bodies, to harmonize the legal system of Serbia with the Eu8 Read more about the objectives and principles of administrative reform: The Government
of Serbia, State Administration Reform Strategy in the Republic of Serbia, October 2004,
p. 13-16.
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ropean Union legislative in the process of adoption of the new sector
laws (but it is not determined which sector laws and regulatory bodies
should it be).
From the legally-legalistic point of view, the Strategy did not “exactly” suggest new forms of administrative control that could significantly contribute to the protection of human rights and through which
deregulation of administrative competences should be provided. In the
meantime, a part of such control bodies were created through adopted
laws which were not mentioned in the Strategy (as the National Audit Institution, Anticorruption Agency, Commissioner for free access
to information and personal data protection). In accordance with the
Strategy, control of the administration mainly came down (apart from
the introduction of the institution of the Ombudsman as a specific
form of supervision and control over the administration and protection of human rights), on the already existing forms of internal and
external supervision namely internal and external controls. Thus, in
the “legalistic part” of the Strategy possible ways for improvement of
the existing internal and external forms of control were not covered.9
Until the middle of 2008 some of the laws referred to in the Strategy were adopted. So, at the end of 2004 the National Assembly of the
Republic of Serbia adopted the Law on Free Access to Information of
Public Importance, in 2005 the Law on State Administration, Law on
Civil Servants, Law on Public Agencies, Law on the Ombudsman, and
at the end of 2007 the new Law on Local Self-Government and for the
first time, the Law on the Capital City. In 2008, the Law on the AntiCorruption Agency, which was not in the Strategy specifically “identified” as important for the administration reform, was adopted. New
laws which would present the heart of the administrative procedure
- the Law on Administrative Procedure and Law on Administrative
Disputes in this period were not adopted.
Certain problems already existed with the corps of laws which already have been adopted and with their implementation. From the
legally-legalistic point of view, the Strategy from the top is controlled
by the state organization, and this direction of the Strategy is primarily
dependent on the level of democracy. Thus, for example, laws on ministries are changing from one to the another parliamentary elections,
9 Compare: The Government of the Republic of Serbia, Ibid., 53-54.
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and their total number, as the most important administrative bodes, is
independent of general social needs but of the needs imposed by the
political spoils system (Spoil System) which is directly contrary to proclaimed principles of depolitization and rationalization.
The State Administration Reform Strategy in Serbia also includes
elements of organizational - procedural reform strategy, which is combined with participation strategy and to some extent with the New
public management strategy.
From the organizational – procedural point of view, the Strategy, in
addition to defining the tasks and needs of the administration, should
provide the organizational reform as well. Strategy was giving more
attention to this part of the reform and can be divided into several
sub-strategies: (1) decentralization strategy which included: deconcentration and devolution, material and financial assumptions of the
decentralization process and the problem of territorial organization,
(2) strategy of fiscal decentralization, (3) strategy of a professional and
depoliticized public administration creation (which gave a sketch for
a later adoption of the Law on Civil Servants in 2005) and (4) new organizational and management framework as a basis for rationalization
of the state administration. Although, the Strategy was paying much
attention to devolution of competencies to the level of local self-government, even new legal framework in this area failed to significantly
change the scope and competences of local self-government. Certain
responsibilities were transferred from the Republic of Serbia to the capital and cities as local self-governments, firstly with the Constitution
from 2006 and then at the end of 2007 with the Law on the capital city
to the city of Belgrade. It wass certainly not enough to achieve the goal
set by the Strategy - the local self-government substantially get closer
to the citizens.
Creation of a professional and depolitized state administration
within the State Administration Reform Strategy10, to some extent, was
later fulfilled by adopting the Law on Civil Servants (2005), but many
solutions are not still implemented.
As for the Strategy of the new organizational framework as a basis for rationalization of the public administration, in the Strategy is
stated: “The main goal is to make a clear delineation of competences
10 Compare: The Government of the Republic of Serbia, Ibid., p. 37-48.
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and tasks between the various state authorities and to avoid overlapping. On the basis of precisely defined types and scope of the work
prepared by the administrative authority it is possible to assess the real
needs of employees.11 In this part of the Strategy is not pointed to possible innovations in the organization of the state administration that
could “rise” from the traditional nomenclature of public administration bodies: ministries, administrative bodies within the ministries and
special organizations, which can be understood as the lack of it. Law on
Public Administration from 2005 has kept this concept. The issue of
reform of government organizations aimed at the creation and transfer
of competencies from traditional public administration bodies to the
new forms of individual organs and bodies with administrative competences, is not sufficiently accented.
In terms of strategy direction on the New public management as a
part of this Strategy, it is partly based on an request to adjust the control system of the public administration to the modern processes, from
which it follows that the administrative authorities in Serbia are expected to bring innovations into the existing system and this would significantly improve processes of management of the public resources.12
State Administration Reform Strategy which was adopted at the end
of 2004 has its good sides, but also significant disadvantages. In some
parts however, the Strategy in the period covered by the Action Plan
from 2004 to 2008 was not implemented, which led to the question
why it was adopted? It appears that these were mostly foreign-policy
reasons, namely the desire to show in international relations with other
countries and international organizations that Serbia has entered into
a genuine transition and public administration reform. Unfortunately,
the State Administrative Reform Strategy is not understood as something that arises from the need to strengthen internal capacity of a still
weak state and with its full implementation the above-mentioned standards of the European administrative space would be achieved. The
process of the European integration is gradually increasing demands
from Serbia to realistically implement what was stipulated by the Strategy, because it was the only way for the adoption of the aforementioned
standards of the EAS necessary for its future accession to the Union.
11 The Government of the Republic of Serbia, Ibid , p. 49.
12 Compare: The Government of the Republic of Serbia, Ibid, p. 50.
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Second phase of Public Administration Reform in Serbia
(2008-2012)
The Stabilization and Association Agreement (SAA) with the European Union, Serbia has signed on April 29, 2008 in Luxembourg,
and the Serbian National Assembly ratified it on September 9, 2008
together with the Interim Trade Agreement. To prepare the country,
particularly the administration for the new challenges and obligations
in the EU accession process, and to fulfill requirements stemming from
the SAA, it was necessary for Serbia to prepare a comprehensive document, which has to integrate existing and enable planning and monitoring of all Government activities in the EU accession process and
their effective coordination (Lilić 2008: 27-28).
Thus, the Serbian European Integration Office prepared the National Programme for Integration of Republic of Serbia into European
Union (NPI), which was adopted by the Government of the Republic
of Serbia with the Conclusion in October 9, 2008.13 In a relation with
the above mentioned Public Administration Reform Strategy, the National Programme for Integration (hereinafter NPI) is designed as a
document that is constantly changing, since it anticipated that the programme will be revised every year, from January to April, after receiving the Annual Report of the European Commission in November last
year. Thus, the Government of the Republic of Serbia adopted a new,
revised NPI in December 2009.14
NPI did not “derogated” the State Administration Reform Strategy,
but in some parts it was “supplemental document” that should enhance
reform. In 2008, the NPI on the basis of the European Partnership established the key short-term and medium-term priorities related to the
public administration.
Short-term priorities arose from the previous phase of reforms,
based on the Strategy, which could be determined as the continuation
of efforts in implementation of public administration reform, which
13 Government of the Republic of Serbia, Conclusion 05 no. 011-8137/2007-10, October 9
2008.
14 This revised National Programme for Integration from December 2009 available on the
web page of the Serbian European Integration Office as Government service:
http://www.seio.gov.rs/upload/documents/NPI/Revidirani_NPI_2009.pdf
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includes the legislative sphere, political influence, professionalization,
rationalization and modernization.15
NPI, in the legislative sphere, gave the priority to the adoption of
the Law on Administrative Court procedure16 (what occurred at the
end of 2009) and to the amendments to the Law on Administrative
Procedure (what occurred in 2010) However, amendments to the Law
on Administrative procedure mostly were on “terminology” and not of
substantive nature.
The other short-term goal which should be, according to the Programme continued with, is depoliticization, which is primarily related
to the consistent implementation of the Law on Civil Servants, as well
as activities related to the conduction of the open competitions for public servants on positions. Also, NPI assumes that the Code of Conduct
for civil servants should contribute to the depoliticization of the civil
service because the Code stipulates the obligation of political neutrality
in the work of civil servants.
Third short-term goal is professionalization. It should contribute to
the further professionalization of civil servants, primarily through their
further training. NPI then, as a separate short-term goal emphasizes the
obligation to secure transparent recruitment and promotion as well as
professionalism and accountability of civil servants, through the consistent implementation of the Law on Civil Servants and the systematic
training of civil servants, conducted by the Human Resource Management Service and the Serbian European Integration Office, and other
public administration bodies within their competences.
Rationalization is the fourth short-term goal, within which there is a
need to develop standardized methodology for conducting functional
analyses in the public administration organs and to provide support for
their implementation, because they ultimately lead to the realization of
this goal.
Modernization has been marked as the last of short-term goals in
the NPI, which should be achieved through the use of a single database,
including the Central personnel records kept by the Human Resource
15 Compare: Government of the Republic of Serbia, National Programme for Integration of
Republic of Serbia into European Union, September 2008, Administrative capacities p.
757 - end.
16 Law on Administrative Court Procedure, „Official Gazette of the RS“, No 111/09.
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Management Service, as well as through systemic training of employees especially regarding to staff training in computers.
Mid-term priorities identified by the NPI from 2008 – they will be,
through the revised Action plan for implementation of the Public Administration Reform Strategy, closer identified and to continue with
activities regarding the raising public awareness on importance of public administration reform and strengthening of inter-sector cooperation in the reform process. Regarding the mid-term priorities under
the European Partnership, the NPI particularly points to the continuation of full implementation of the Law on Civil Servants and the Law
on State Administration, and to strengthen capacities for policy formulation and coordination of the administration work at the local level,
to implement the constitutional provisions relating to decentralization
and to provide resources for local self-governments.
In May 2009, continuing this process, the Government has adopted
the new Decision on the Establishment of the Council for State Administration (May 6, 2009), as a central strategic body of the Government for implementation of the State Administration Reform Strategy.
Council is chaired by the Prime Minister. Council precisely defines
tasks that promote and monitor implementation of the Strategy. Also,
the Council assesses the application of principles and objectives of
public administration in sector development strategies and planning
documents and provides an opinion during the establishment of new
state institutions, organizations, services or government bodies. In July
2, 2009, the Government adopted the Action Plan for implementation
of the State Administration Reform Strategy in Serbia for the period
from 2009 to 2012.17
According to the opinion expressed by WAZ.EU observer in February 2010, related to the evaluation of period when Serbia could become
EU member, it was noted that Serbia has better administrative capacities than its neighbors and during the accession negotiations that will
last at least four years, there will be additional opportunities for them
to be strengthen toward the European standards. Also, in this context it
was pointed out that unlike previous enlargements, a number of crite17 Compare: Action plan for the implementation of the Public Administration Reform
Strategy in the Republic of Serbia for the period 2009 until 2012, available on the web
page of the Ministry for Human and Minority rights, State Administration and Local
Self-government:
http://www.drzavnauprava.gov.rs/view_file.php?file_id=607
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ria must be met even before the opening of negotiations on individual
chapters18, that certainly requires further accelerate of the process of
administrative reform, its consistent implementation and harmonization with the standards of the EAS.
This statement becomes more topical at the moment, after Serbia
submitted its application for membership in the European Union in
December 2009 and the EC adopted the decision on forwarding it to
the EU on 25 October 2010.
However, the European Commission in its Report for 2010, in the
part related to the political criteria, states: “There has been some progress in public administration reform. However, the legislative framework remains incomplete. The law on administrative procedures has
not been adopted yet. The law on administrative disputes is not fully in
line with European standards. Further efforts are needed to introduce
a merit-based career system and effective human resources management. The capacity of the public administration in certain sectors is
weak and coordination is not fully ensured. In view of an intensification of the EU integration process in the coming years, Serbia needs to
further strengthen capacity on EU integration, in particular the central
coordination (…)”19.
Similar statement is contained in the Report of the European Commission for 2012 „Little progress has been achieved regarding public
administration reform. The Public Administration …. Reform Council continued to address only administrative and technical issues and
did not actively steer the implementation of the Public Administrative
Reform Strategy which remains insufficient. Greater political commitment (…) are needed to bring about administrative reform. The legislative framework is still incomplete. New legislation on general administrative procedures and on local government employees and salaries
is yet to be adopted. The Law on Administrative Disputes still needs
to be fully aligned with European standards for judicial review of administrative acts. The policy planning and coordination system needs
to be improved to steer policy development and produce consistent
work plans for the public administration. The Law on Civil Servants
does not apply to local government employees. The recruitment and
career system is not yet fully merit-based and recruitment is still prone
18 WAZ.EUobserver www.WAZ.EUobserver.com , February 2, 2010.
19 European Commission, {COM(2010) 660} Serbia 2010 Progress Report, p. 8.
123
to political influence. Local government does not have a merit-based
and professional human resources service. Temporary employees are
still not recruited according to competitive criteria and contracts are
allocated without internal or public competition.”20
The conclusion that can be drawn at this phase of the reform is
similar as the conclusion related to the previous phase. Neither one
of the envisaged short-term or medium-term objectives contained in
the NPA nor in the Action Plan for the State Administration Reform
Strategy implementation from 2009 to 2013 has not been accomplished. Also, significant political influences on the work of the state
administration existed in this period and numerous decisions of the
state administration had been made under the influence of daily political needs. Professionalization did not occur because in this period
political party recruitment of civil servants in the state administration existed, thus the spoils-system disabled realistic implementation
of the Law on civil servants. According to the assessment of the Fiscal
Council from the end of August 2013, in the public administration in
Serbia, only in the health and education there is an excess of 20.000
employees and in the state administration approximately 5.000, thus
Serbia has become negative recorder related to allocations for employees in the public sector with over 12% of GDP in the Eastern
Europe.21 Rationalization, which included a significant reduction and
elimination of a number of state administration bodies / agencies did
not occur. Despite the announcement of the new Serbian Government, which was established in July 2012, that it will significantly reduce the number of unnecessary administrative authorities / agencies
(number of over 60 was mentioned), in September 2012 the Government has sent to the National Assembly numerous proposals for
amendments of the existing laws and after their adoption by the National Assembly of the Republic of Serbia on September 25, 2012 only
seven has been abolished (National Development Corporation, Fund
for Environmental Protection, Chemicals Agency, Agency for Energy
Efficiency, Games of Chance Administration, Foreign Exchange Inspectorate), which is much less than it was previously announced.
20 European Commission, {COM(2012) 600 final}, Serbia 2012 Progress Report, p. 8.
21 Compare: Nikola Altipamarkov, Serbian Fiscal Council member (statement),, 27.08.2013.
RTS „Public Sector - counting by supernumerary“
http://www.rts.rs/page/stories/sr/story/13/Ekonomija/1385104/Javni+sektor,+prebrojav
anje+prekobrojnih.html?tts=yes
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Despite pre-election promises, this was the logical epilogue, since in
the Republic of Serbia, there was not or is not a list of the competences
and duties of administrative bodies and agencies, and without such a
detailed list, real organizational reform of public administration cannot occur. The new Law on General Administrative Procedure even
in this period had not been adopted despite numerous announcements, as neither the Law on Local Public Servants, which should
introduce civil servants merit system at the local level.
However, drafting the new administration reform strategy has
started in this period. Study on decentralization and subsidiary has
been completed (Djordjević, Milenković, Prokopijević 2013), which
should be the basis for a list of the competences and duties of the administrative bodies that should occur in the next phase. These tasks
were mostly realized or still are in the process of realization through
projects of the European Union and international donors. National
Plan for the adoption of the Acquis (2013-2016) has been adopted,
with indicated suggestions of priorities in terms of harmonization of
legislation in the field of public administration.22
Third phase of Public Administration reform (2013-2014)
The Stabilization and Association Agreement entered into force on
September 1, 2013. Until this moment this is the last and shortest phase
in the analysis of the process of administration reform in the Republic of Serbia and it is currently difficult to predict the final outcome.
Therefore, it is currently difficult to predict how much time the Republic of Serbia will need to reach the EAS standards, what will be political
influences on the reform process in the administration and in which
manner the reform will be implemented.
However, during this period, some new steps have been made. At
the end of January 2014, the new Administrative Reform strategy has
been adopted. Significant progress has been made through the extension of the subject of the strategy, thus the previous State Administration Reform Strategy is now the Public Administration Reform Strategy, with purpose to achieve a functional unity and quality standards
22 Compare: Governmenet of Republic of Serbia, Office for European Integration, National
Plan for the adoption of the Acquis - NNPA (2013-2016), February 2013, p. 24-25.
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of activities to perform certain types of administrative affairs and
public competences independently of the subject performing them
(bodies, organizations, institutions).
In this way, the new Public Administration Reform Strategy included not only state authorities but also administrative authorities
at lower levels of the authority, all other organizations and agencies
entrusted to perform administrative public powers, as well as organizational forms of public services, such as public utilities and public institutions in different areas (health, education, public utilities,
etc). Reform of the administration finally has been considered as a
reform based on the notion of modern social systems theory (Luhmann 1997), which is a significant step forward compared to the previous period, when the reform included only the organs and functions of state administration at the central authority level. The basic
principles of public administration reform are defined as previously
mentioned standards of EAS and they represent the starting point in
the Strategy.
Measures and activities for realization of the specific Strategy objectives are divided into:
-- (1) improvement of the organizational and functional subsystems of
public administration which include: organizational and functional
restructuring of organs, organizations and other bodies performing
public administration affairs; promotion of decentralization and
deconcentration of state administration; improvement of the
strategic planning system and coordination of public policies;
development of e-government;
-- (2) establishment of a coordinated public-servants system based on
merits and improvement of human resource management which
include: establishment of harmonized system of labor relations and
salaries of employees in the public administration and development
and improvement of management of human resources in public
administration;
-- (3) improvement of public financial management and public
procurement which include: improvement of the process of budget
planning and preparing; improvement of the management and
control of public revenues and internal audit and improvement of
the public procurement system;
126
Dejan Milenković
Serbian Public Administration Reform in the Light of the
European Administrative Space Principlest
-- (4) increasement of legal certainty and improvement of business
environment and quality of public services providing, which
include: improvement of legislation drafting process; improvement
of administrative procedures; reform of inspections supervision and
increasement of transparency, improvement of ethical standards
and accountability in the performance of public administration,
which includes, improvement of conditions for the participation
of the public concerned in the work of public administration
and strengthening ethical standards of employees in public
administration and reduction of corruption;
-- (5) strengthening supervision mechanisms in public administration.
Measures and activities set in this way are compliant with SIGMA
standards, which should contribute to and facilitate the monitoring of
implemented activities in the context of fulfillment the standards of
EAS, which will be of crucial importance for the assessment of administrative capacities before bringing the decision on full membership of
the Republic of Serbia in the EU.
Also, a list of the competences and duties in the public administration was initiated, which will in the following period significantly
affect the reform of the administrative organization. Enhanced NPPA
for the period from 2014 to 2018, adopted in July 2014, as a priority
related to the public administration sets up the adoption of the Action
plan for the implementation of the new Public Administration Reform
Strategy.23
However, it concerns that the Government of the Republic of Serbia, even after 9 months, did not adopt the aforementioned Action Plan
of the Strategy with clearly defined activities, indicators, responsible institutions for implementation of activities, timelines and resources for
the implementation of this strategy. Without the Action Plan, attempt
of its realistic implementation will remain voluntary and without clear
information on the progress public administration reform process and
to which extent the EAS standards are in Serbian public administration
implemented.
In the European Commission’s Report for 2014 it is stated that the
the new public administration reform strategy and recovery of the
23 Compare: Governmenet of Republic of Serbia, Office for European Integration, National
Plan for the adoption of the Acquis - NNPA (2014-2018), July 2014, p. 19-20.
127
Council’s for State Administration Reform work in August 2014, as
well as the establishment of the Secretariat for Public Policies, may considerably improve development and coordination of public policies in
the Republic of Serbia. However, the Report states that… “recruitment,
both for senior and middle management positions, continues to be an
issue of serious concern, as, in 2013, a substantial proportion of recruitments (60%) was not based on open competitions. The current legal
framework and its uneven application leave room for undue influence
in the recruitment process”.24
Conclusion
Standards of the European administrative space were built in decades. The European Court of Justice, the legislative activity of certain organs of the Union, SIGMA Programme and review of the administrative capacities of potential candidates for membership in the
Union, influenced in recent years on the administrative processes in
Serbia as well.
The process of administrative reform in Serbia is carried out for
fifteen years. In different cycles this process was faster or slower. Comparative analysis of the European administrative space standards and
the process of administrative reform in Serbia, it can be concluded
that Serbia, even perhaps not fast enough, is increasingly adapting
to these standards. In achieving these principles, legally - legalistic
direction of the reform is important and in this respect in recent years
a significant number of laws were adopted. Certain organizational
- procedural and management measures were also undertaken, but
however a significant “barriers” that impede the reform process still
exists.
However, “partokratia” still has a significant impact on the public administration and real implementation of legislative reforms and
other measures that have been proclaimed in the Public Administration Reform Strategy and the Action plan for its implementation,
as well as in the National Programme for Integration of Republic of
Serbia into European Union still depends on political will. So it seems
24 Compare: European Commission, {COM(2014) 700 final}, Serbia 2014 Progress Report,
p. 9-10.
128
Dejan Milenković
Serbian Public Administration Reform in the Light of the
European Administrative Space Principlest
that the evaluation, that Serbia has the administrative capacities capable to implement the legislations that the Union is adopting, at this
moment is not real.
On the other hand, the elimination of the aforementioned “threats”
to the complex administrative system could accelerate the reform
process. Until the accession of Serbia to the European Union there
is enough time to adapt its “administrative capacity” to the standards
of the European administrative space. But the “time factor” must not
be a reason to abandon this course for any reason. So, it is the best
that this “condition” for admission became true as soon as possible,
because on the road to the full membership to the EU we are certainly
expecting many other tasks and problems as well.
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132
Institute for Political Studies
UDC 336.121:[354.1:329.051(4-664)
Manuscript received: 22.08.2014.
Accepted for publishing: 16.09.2014.
Original scientific paper
Serbian Political Thought
No. 2/2014,
Year Vl, Vol. 10
pp. 133-157
Dušan Pavlović1
Faculty of Political Sciences, Belgrade
Miloš Bešić2
Faculty of Political Sciences, Belgrade
The Budget Dilemma and Public Spending:
Evidence from Ten Postcommunist
Countries3
Abstract
The paper examines whether the number of parties in the cabinet and the
type of coalition affect the level of public spending. It offers a statistical analysis of two hypotheses: (1) the larger the number of parties in the cabinet, the
higher the public spending; (2) minority and minimal winning coalitions tend
to spend more, whereas large majority coalitions tend to spend less. The analysis draws on statistical data from ten East-Central European countries, with the
data confirming the first and rejecting the second hypothesis. The paper offers
two novelties. First, it defines a new concept (the Budget Dilemma) to test the
relationship between the number of parties and the level of public spending.
Second, it uses data about the countries that has appeared less frequently in
similar types of research and studies, providing new observations for testing
the relationship between the number of the parties in a cabinet and the level of
public spending.
Keywords: Budget Dilemma; fiscal policy; public spending; minimal winning
coalition; oversized coalition.
1
2
3
Associate professor
dusan.pavlovic@fpn.bg.ac.rs
Assistant professor
milos.besic@fpn.bg.ac.rs
This paper is part of the Belgrade University’s research project titled “Political Identity
of Serbia in Local and Global Context” financially supported the Serbian Ministry of
education and science (project no. 179076).
133
1. Introduction
In his study on veto players, George Tsebelis claims that larger
number of actors in a decision making body increases the likelihood
of policy stability (Tsebelis 1995; 2002). The claim has to do with the
size of the winset of status quo (a set of policy proposals that can defeat
the status quo). If two decision makers have to decide on a policy that
departs from the status quo, they will find it easier to agree on the departure than three decision makers, three easier than four, and so on.
The larger the number of players, the smaller the winset, and hence a
more stable public policy.
The implication is clear: the policy stability is a function of the number of players, and, in that case, has a positive slope (Figure 1). Public
policy is the least stable when the number of players is minimal (value
1 on the y axis). When only one party is in the cabinet, it can practically
do whatever it wants vis-à-vis public policy change (provided it reached
an internal party consensus on it). Smaller number of members increase
the likelihood of policy change, because the winset from which an option that can defeat the status quo can be drawn is larger. Assuming
that the winset depends on the number of actors in the government,
Tsebelis derives a simple theorem: the more actors in the government,
the smaller the winset, and the less likely the policy change. In such a
situation, the stability of the policy is high (Tsebelis, 2002, 2; 22-3).
Figure 1: Policy stability as a function of the number of players –
Tsebelis’s view
134
Dušan Pavlović, Miloš Bešić
The Budget Dilemma and Public Spending:
Evidence from Ten Postcommunist Countries
In this paper we want to prove an opposite thesis. We claim that a
large numbers of cabinet members increases the likelihood of policy
change. We draw on Persson and Tabellini’s attempt conceptualize the
same problem. In The Economic Effects of the Constitution (2003) they
demonstrate a different policy stability function. On their theory, based
on the problem of collective action (Olson 1965) and the common pool
resource problem (Hardin, 1968), policy stability is also a function of
the number of parties, but here the stability is lower as the number of
parties goes up. Thus, the slope of the function is negative (Figure 2).
When the number of parties is small, policy stability is high. In contrast, when the number of parties in the cabinet increases, policy stability drops.
Let us apply this concept of policy stability to fiscal policy, which is
a subject matter of this paper. Policy stability is about stability in spending. When we observe that cabinet can easily change its fiscal policy—
decrease or increase spending—we say that policy stability is low. In
contrast, when we observe that cabinet is unable to change level of
spending, policy stability is high.
Figure 2: Policy stability as a function of the number of players – Persson
and Tabellini’s view
Persson and Tabellini examined the correlation between the electoral system and level of spending. They claim that cabinets that emerged
from proportional representation tend to spend more (Persson and
135
Tabellini, 2003).4 They do so because such cabinets are composed of
more cabinet members. Higher number of cabinet members increase
the likelihood of higher spending. In other words, if a cabinet has x
members, and we observe a spending of €1 billion in t1, the spending
level in t2 is likely to significantly rise beyond €1 billion provided the
number of cabinet members is x+y (where y>0) in t2.
2. Contribution of this Paper
This paper draws support from and empirically test Persson and
Tabellini’s view, and opposes Tsebelis’s veto player theory. We draw on
the common pool resource problem (Hardin, 1968) which we apply
to fiscal policy. It suggests that public spending rises as a function of
the number of participants in the policy making. The major reason
for such a behavior is that policy makers receive all the benefits from
such a policy, but internalize only a fraction of its cost. The cost can be
transferred to actors who are outside the cabinet (e. g. tax payers, next
cabinet, or next generations), and the upshot is aggregate overspending
(Persson and Tabellini 2003: 26).5
In order to prove our point, we offer a game theory concept titled
Budget dilemma. We conceptualize the general relations among actors
(section 3), but also a more specific relation that depends on the type
of the coalition (section 4). Finally, we offer an empirical test to support the Budget dilemma. We run OLS regression to test if the number
of parties and the type of the coalition increase public spending (section 7). Our sample is ten post-communist countries that are usually
avoided in this type of research.6
3. The Model
We ask two research questions:
-- does a number of players in a cabinet increase public spending?;
-- if not, does the type of the cabinet increase the level of public
spending?
4 However, in contrast to Persson and Tabellini who are more interested in the causal
relation between electoral systems and public spending, we look into the relation between
the number of players and policy change, leaving the issue of electoral systems aside
5 Persson and Tabellini’s book has a large sample, but many post-communist countries are
excluded from the sample.
6 The definition of minimal winning coalition will be given in section 4.
136
Dušan Pavlović, Miloš Bešić
The Budget Dilemma and Public Spending:
Evidence from Ten Postcommunist Countries
Before we offer empirical answers for these questions, we outline a
model that theoretically supports our claim. The game model is suited
to analyzing the interactions between actors in the cabinet when it (the
cabinet) has to decide how to tackle fiscal policy matters—notably,
public spending. We name the game the Budget Dilemma (BD). We
start by considering a simple model with two players.
Suppose there are two political parties, THE GREEN and THE REDS,
which form a minimal winning coalition.7 Both parties received approximately equal electoral support, slightly over 25%, so both are veto
players in Tsebelis’s sense. THE REDS represent mainly older population
and the badly-off, whereas THE GREENS represent mainly “green” entrepreneurs and social groups that advocate the usage of green technology in the economy. Suppose that, after the previous cabinets’s history
of high public spending, these two parties make an agreement (perhaps
brokered by the IMF) to pursue a sustainable fiscal policy8 —namely, to
cut public spending and arrest the increase of public debt.
Each party has a choice between two options: it can stick to the
agreement to run a balanced budget (cooperate), or it can demand
more spending which will benefit only itself and its electorate (defect).
If both parties pursue policy of higher spending, there will be aggregate
overspending. More formally, the model can be presented in Figure 3.
Figure 3: The Budget Dilemma with two players. A general form.
7 Sustainable fiscal policy is any policy that will not end up in a bankruptcy.
8 I am not discussing long-term effects of defection. Mainly because most officials are out
of office when long-term effects start to take place, and the cost of high spending is paid
up by next cabinets.
137
We claim that the outcome of the Budget Dilemma represented in
Figure 3 is aggregate overspending which is a function of the number of
cabinet members. The idea is based on the same fiscal policy function
that characterizes the Persson and Tabellini model (Figure 2): larger
number of cabinet members produces unstable public policy; smaller
number of players keeps public policy stable.
To express the main idea more clearly, we could reproduce Figure
3 by assigning cardinal values to the outcomes. Suppose that this year’s
budget is €4 billion. If both cabinet members abide by prudent fiscal
policy, the outcome will be (2, 2). However, suppose that THE REDS
demand larger budget deficit in the amount of €5. In this case, THE
GREENS cannot block the budget increase even if they wanted to, because THE REDS have veto power and could bring down the government. In order not to be suckers (outcome 2, 3), THE GREENS accept the
budget increase by demanding their share of the pie, thus producing an
aggregate overspending (3, 3).
Figure 4: The Budget Dilemma expressed in cardinal values.
***
The BD assumes a world without fiscal rules (most countries from
our sample are such). In the world without fiscal constraints, the opportunity for defection is risk-free (in the short run ). By taking out
loans from local or international funds, the government can simply
138
Dušan Pavlović, Miloš Bešić
The Budget Dilemma and Public Spending:
Evidence from Ten Postcommunist Countries
roll over the spending costs to the next cabinet or to the next generation. This is a practice that has a theoretical grounds (PetterssonLibel 2001), but also lot of empirical confirmation in both pre- and
post-2007 financial crisis period. With few exceptions, governments
are free to accumulate new debt, run budget deficit, and increase aggregate spending even if they fail to reach an agreement on how to
execute the initial budget plan.
Under the BD assumptions, mutual defection is preferred. When
two players defect and converge on (3, 3), it is not a concerted action of
the two players, but rather a rational choice to get a larger share of the
pie in the situation in which everyone else does the same. Players will
not miss the opportunity to enlarge their share, when there is no cost
and when everyone else does the same.
This is a type of sucker game but in its most general sense. Being
sucker is not an essential feature of the game.9 Rather, it is the absence
of cost. If we both could have payoff of (3, 3), and I choose (3, 2) instead, I am a sucker for not using the opportunity to get (3, 3). But the
major drive for aggregate increase comes from the absence of cost for
one’s action.
The model can be expressed more formally. Let g and r indicate
cabinet members (GREENS and REDS), P policy, x decision of a cabinet
member, and S total spending. If so, S will be an aggregation of two
decision on how much to spend.
S = Pg(x) + Pr(x)
Each particular actor will make decision based on the cost-benefit
calculation. It will make a decision on how much to spend if its benefits
outweighs costs.
Pi(x) = b(x) > c(x)
Since there is no fiscal rules, the cost of higher spending is practically zero, meaning that the decision to spend more brings only benefits,
but no costs. When fiscal rules do not regulate fiscal policy, the cost
of higher spending is transferred to next cabinets, or next generations.
It’s them, rather than the current cabinet, who will have to service the
today’s costs of higher spending.
9 To repeat, it is a game in a qualified sense. Strictly speaking, it is not a game at all, because
my action does not really depend on your action.
139
On the ground of this, we formulate our first hypothesis (H1): the
more members there are in a cabinet, the higher public spending it
will be.
4. The Type of the Coalition
As mentioned, we want to test yet another hypothesis—if the type of
the coalition increases public spending. We differentiate among three
types of coalitions based on the size principle (Riker 1962):
-- minority coalition government, which has no simple majority in
the parliament;
-- minimal winning coalition (MWC), which has a minimal (simple)
majority in the parliament (50%+1); and
-- oversized coalition, which has more than a simple majority.
Suppose again that there are no fiscal rules. Will the behavior of
the actors remain the same irrespective of the type of the coalition? If
THE REDS prefer prudent fiscal policy, and THE GREENS do not, will
THE REDS give up? Will they both end up in (3, 3)? This time, it depends on the type of the coalition. In minority cabinets and MWCs,
each veto player has much greater veto potential: it is enough that
only one member withdraws its support, and the cabinet has to be
dismissed. Veto capacity is much smaller (or non-existent) in oversized cabinets, because the withdrawal of the support leaves the cabinet intact.
Consider the behavior of cabinet members in oversized cabinets.
Member i cannot veto prudent fiscal policy proposals anymore. If i
wants to withdraw its support, it will be dismissed from the cabinet
for which it will receive the payoff of 0. The cost of such a decision is,
therefore, negative, because costs looms larger than benefits.
Pi(x) = b(x) < c(x)
The game from Figure 3 can be now presented in a extensive form
which reflects the fact that THE GREENS receive the payoff of 0 for defection (Figure 5).
By using backward induction, the outcome of this game should
be (3, 3), but we qualified this game by saying that THE REDS prefer
prudent fiscal policy (want to keep spending within (2, 2)). If THE
140
Dušan Pavlović, Miloš Bešić
The Budget Dilemma and Public Spending:
Evidence from Ten Postcommunist Countries
Figure 5: Budget Dilemma in oversized coalition with THE REDS
preferreing prudent fiscal policy
REDS seriously prefer prudent fiscal policy, the upper part of the
decision tree is eliminated, and we apply backward induction only to
what is left in the lower part (Figure 6). The outcome of this game is
now (2, 2)—namely, prudent fiscal spending.
Figure 6: Equilbrium outcome of the Budget Dilemma in oversized
coalition with THE REDS preferring prudent fiscal policy
141
From this discussion we formulate our second hypothesis (H2):
the structure of minority cabinets and MWCs will increase public
spending (such cabinets will tend to spend more). In such cabinets
each member is a veto player with the power to bring the cabinet
down. In contrast, surplus cabinets (oversized coalitions) will tend to
spend less because in such coalitions no member has veto power.
5. The Selection of Countries
For our analysis, we selected ten countries that were members of
the communist block in 1945-1989. All are at least semi-consolidated democracies, using the Freedom House (FH) democracy score10.
Since different countries in our analysis cleared the threshold for democracy at different times, we use data for each country only from
the time when they became at least semi-consolidated democracies
according to the FH score.11
Six out of ten countries are semi-presidential regimes (meaning that
their presidents are elected by a popular ballot). The Persson & Tabellini study differentiates only between parliamentary and presidential
regimes, subsuming semi-presidentialism (such as in France and Finland) under parliamentary systems (Persson and Tabellini 2003: 97).
There are several studies on semi-presidentialism (Elgie 2008; 2011;
2012), but rare are those that explore the impact of semi-presidentialism on economic policy (Schleiter and Morgane-Jones, 2010). Further,
there are significant differences among presidential systems, as well as
among parliamentary systems (Persson and Tabellini 2003: 95-6). At
this point, we cannot determine whether semi-presidentialism is significant for the analysis (but see Pavlović, 2011 for Serbia). Therefore,
we assume that presidents in semi-presidential regimes do not significantly affect economic policy, and we subsume the semi-presidential
countries from our sample under parliamentary regimes.
10 For the Freedom House categorization visit: http://www.freedomhouse.org/report/
nations-transit-2012/map-regime-classifications. (Accessed on September 20, 2012)
Freedom House categorizes a country as a democracy if it has a score of 3.00-3.99.
We would prefer to use some other index, such as Economist Intelligence Unit’s index
of democracy. However, we use the FH index because it covers a greater number of
years.
11 We do not follow religiously the FH democracy score. In the case of Serbia and
Montenegro, we declared the countries semi-consolidated democracies one year earlier
(in 2001) than the Freedom House analysts. We started following some countries later
than when democracy was declared by FH due to the limited availability of data for those
countries.
142
6. Data Method and Measurement
Our data file contains a total of 177 observations. The number of observation per country is presented in Figure 7. Due to the inaccessibility
of data for each year, we covered the period from 1992 to 2012 with the
indicated different number of observations per year (Figure 8).
Figure 7: Number of
observations per country.
Figure 8: Number of
observations per year.
Figure 9: Mean and median number
of parties in the cabinet.
143
The main independent variable in this analysis is NUP (number of
parties in the cabinet). Figure 9 reports the mean and median number
of parties per country.
Our second dependent variable is COL (type of coalition, as defined
in section 4). We present the distribution of this variable per country in
Figure 10.12
Figure 10: Type of coalition per country.
Bearing in mind that our dependent variable may depend on many
possible factors, to control the model, we introduced background variables which are, according to the theory, significant predictors of our
dependent variables. These are reported in Figure 11.
Variable SOI (strength of institutions) indicates mean value based on
z scores of four variables (Rule of Law, Control of Corruption, Corruption Perception Index, and Freedom House Index).13 We created this
variable because we observed a strong intercorrelation among the four
12 The data for coalition type are personal calculations of the authors.
13 The first two variables in this set are based on the World Bank’s Governance Matters
study. Full data can be viewed at http://info.worldbank.org/governance/wgi/index.asp.
(Accessed on March 11, 2013). The curruption perception index variable is obtained from
Transparency International data (view data at http://www.transparency.org; accessed
March 11, 2013), and Freedom House index from the Nations in Transit study (http://
www.freedomhouse.org/report-types/nations-transit; accessed on March 13, 2013).
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Dušan Pavlović, Miloš Bešić
The Budget Dilemma and Public Spending:
Evidence from Ten Postcommunist Countries
Note: Freedom House Index is converted in order to reach the same direction of the interpretation
as with other variables (i.e. making the interpretation intuitive).
Figure 11: Control independent variables. Note: Freedom House Index is
converted in order to reach the same direction of the interpretation as with
other variables (i.e. making the interpretation intuitive).
variables in question (Cronbach’s Alpha = 0.90). In this way we avoid
the multicollinearity problem in the regression analysis. In addition,
in the final models it was necessary to exclude some other possibly
important variables such as FDI (foreign direct investments) and
INC (income per capita). These two variables are highly correlated
with GDP. Leaving them in the analysis would produce the problem
of multicollinearity. Therefore, they were both tested and excluded.
We produced an additional variable (dummy by its nature) and
named it election year (EYR). We wanted to test whether government
spending was affected by the fact it is a year in which elections are
held. The political economy literature on opportunistic behavior and
political cycles claims that politicians are opportunistic and use voter
naivety to win votes through increased spending (Nordhaus 1975;
Hibbs 1986).
Some other studies refer to strategic debt behavior to prove that a
government can use public debt to constrain the behavior of future
governments (Pettersson 2001; Alesina and Tabellini 1990; Persson
and Svensson 1989). The distribution of the elections per country is
presented in Figure 12.
145
Figure 12: Elections held in countries.
The last background variable we produced is YOO (years of observation), because each observation is situated in a specific year. By
introducing the year of observation as a variable, we control the model
since it could be possible that the very dependent variables are a function of “time” rather than on independent variables we want to test.
Figure 13: Dependent variables.
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Dušan Pavlović, Miloš Bešić
The Budget Dilemma and Public Spending:
Evidence from Ten Postcommunist Countries
In order to test our hypotheses, we used four dependent variables,
producing a separate regression analysis for each of them. Our main
target is SPE (spending), which practically consists of three separate
variables—DEF (budget deficit as a percentage of GDP), DEB (public
debt as a percentage of GDP), and EXP (budget expenditure as a percentage of GDP). The distribution of the three variables is presented in
Figure 13.14
Figure 14: Communalities.
Figure 15: Component matrix. Note: First and
only component explains 57.85% of variance.
Our main dependent variable, SPE, is created as a factor regression
score based on principal component analysis with three variables, as
explained above. The result of the principal component analysis is presented in Figures 14 and 15.
14 All economic data – GDP, unemployment rate, public expenditure, public debt, and
budget deficit – are from the Economicst Intelligence Unite Database.
147
Finally, Figures 16 and 17 displays the distribution of SPE, as the
main dependent variable.
Figure 16: SPE – statistics.
Figure 17: SPE – distribution.
7. Analysis and Results
In order to test the theory based on our empirical evidence, we formulate two hypotheses in accordance with the model presented in sections 3 and 4:
H1: The number of parties in the government is a statistically significant predictor of government spending. The greater the number
of parties in the cabinet, the higher the spending.
H2: The type of coalition is a statistically significant predictor of
government spending. Minority cabinet or minimal winning coalition will tend to spend more; oversized coalition will tend to spend
less.
In order to test our hypotheses, we present the bivariate correlation
among NUP and SPE (Figure 18). We find weak correlation. Moreover,
we can identify negative correlation among some aspects in question,
which runs contrary to the theory. Therefore, it is not to be expected
that the number of parties is a strong predictor of public spending.
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Dušan Pavlović, Miloš Bešić
The Budget Dilemma and Public Spending:
Evidence from Ten Postcommunist Countries
Figure 18: Bivariate correlations between NUP and SPE - per countries.
We also use bivariate statistics to estimate the relationship between
COL and SPE (Figure 19). More precisely, we compare the mean value
of each dependent variable in relation to the two types of coalition.15
The results of the t-test showed that strong predictability of the type of
coalition for dependent variables is not to be expected.
Given that SPE consists of three variables, and that we test two different hypotheses, we run OLS regression analysis to produce eight
different models. More accurately, we produce two models for the
same four dependent variables with different independent variables
(number of parties and type of coalition), but keep the same background variables to control the model.
Figure 20 presents the results of the OLS regression analysis. In
models 1.1 and 1.2, we present unstandardized regression coefficients
for DEF. In both models, it can be seen that neither NUP nor COL
is a significant predictor. Background variables seem to have strong
predictability. More specifically, GDP (in model 1.1: B= –0.373; p
<0.01 and in model 1.2: B= –0.364; p <0.01) and SOI (model 1.1: B=
–0.741; p <0.05 and model 1.2: B= –0.786; p <0.05) are negative pre15 Figure 19 shows that we grouped minority and minimal coalition into one group, and
kept oversized coalition in another.
149
Figure 19: Type of coalition and spending variables – MEAN and T test.
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Dušan Pavlović, Miloš Bešić
The Budget Dilemma and Public Spending:
Evidence from Ten Postcommunist Countries
dictors. However, unemployment rate (model 1.1: B= –0.103; p <0.01
and model 1.2: B= –0.104; p <0.01) is a significant predictor, but the
reasons are unclear due to its negative predictability.16 Although in
model 1.1 and 1.2 we cover a more than satisfying 27.2% of variance
of the dependent variable, the sum of squares of the model is still significantly smaller than the sum of squares of the residuals.
In the case of DEB, presented in models 2.1 and 2.2, NUP and COL
are not significant predictors. As in the previous model, GDP seems
to be a strong negative predictor (model 2.1: B= –1.226; p <0.05, and
model 2.2: B= –1.091; p <0.05) as well as SOI (model 2.1: B= –10.043;
p <0.01 and model 2.2: B= –10.334; p <0.01). But in the case of this
dependent variable, YOO is also significant negative predictor (model 2.1: B= –0.942; p <0.05, and model 2.2: B= –0.795; p <0.05). This
finding simply shows that as the time passes (measured by year), DEB
gets smaller. Finally, model 2.1 covers 19.6% and model 2.2 covers
20% of variance of the dependent variable. Still, the sum of squares of
the model is much smaller than the sum of squares of the residuals.
Our third dependent variable is EXP (public expenditure). We
present the analysis for this variable in model 3.1 and 3.2. First, and
most important, NUP is a significant predictor for EXP, as predicted
by the theoretical framework (B=0.468; p <0.01). However, neither
NUP nor COL are significant predictors.
As in model 2, two of the background variables in model 3 have
negative predictability: GDP (model 3.1: B= –0.457; p <0.01 and
model 3.2: B=–0.459; p <0.01) and YOO (model 3.1: B= –0.296; p
<0.01 and model 3.2: B=-0.245; p <0.05). Interestingly enough, SOI
(model 3.1: B=4.069; p <0.01 and model 3.2: B=3.272; p <0.01) is a
positive predictor, which is the opposite position for this variable than
in the previous two models. Thus, budget spending increases when
institutions are stronger.
The predicting variables have the largest explanatory power in this
model compared to the other dependent variables. We explain 36.8%
variance of EXP in model 3.1 and 30.9% in model 3.2. The sum of
squares of this model is smaller compared to the sum of squares of
the residuals.
16 It was expected that the higher unemployment rate, the bigger deficit. However, according
to our empirical evidence it is the opposite, which probably means that unemployment
rate is collinear with some other variable not included in the model.
151
152
Figure 20: Predictors of SPENDING - OLS unstandardized regression coefficients.
*** 99% of CI, ** 95% of CI, * 90% of CI.
Dušan Pavlović, Miloš Bešić
The Budget Dilemma and Public Spending:
Evidence from Ten Postcommunist Countries
Finally, we run a regression analysis for our composite variable SPE
(model 4.1 and 4.2). The most important finding, which supports H1,
is that NUP is a significant predictor of SPE (overall spending of government) (B=0.053; p <0.05). However, we did not find any empirical
support for H2, meaning that COL is not a significant predictor for
SPE. As we found in the first model, unemployment is a significant
negative predictor of SPE (model 4.1: B= –0.019; p <0.1 and model
4.2: B= –0.019; p <0.1). GDP remains the strongest and most stabile
negative predictor (model 4.1: B= –0.100; p<0.01 and model 4.2: B=
–0.095; p <0.01). It is interesting that YOO is a statistically significant
negative predictor for model 4.1 (B= –0.038; p <0.05), but it is not
significant in model 4.2. Finally, model 4.1 covers 15.9% of variance
of dependent variable, and model 4.2 covers 13.2%. In both models,
the sum of squares is significantly smaller compared to the sum of
squares of residual.
8. Interpretation of the Findings
To recap, we proposed that the number of parties in the cabinet and
the type of coalition affect public spending. We tested two specific hypotheses for four dependent variables, each of which represents public
spending in a different way. Consequently, we developed eight different
models and ran an OLS regression to test the hypotheses.
Let us begin with H2, which we rejected. We did not find empirical
support for the claim that minority or minimal cabinets spend more
than oversized coalitions. We found one possible reason to explain such
an outcome. As shown by the analysis in section 7 (Figure 20), GDP
is a rather strong negative predictor of public spending: when GDP is
growing, DEF and DEB tend to drop (and vice versa). It seems that the
type of coalition does not matter as long as the economy is expanding.
This is precisely what happened over the 2000-2008 period, which accounts for almost 2/3 of our observations.
Consider several examples. The only time the Serbian government
ran budget surplus was in 2006, when the ruling coalition was a minority
coalition. This could be opposite of what the model (section 4) claims.
In minority cabinets, each member has greater veto power, meaning
that deficit should rise. But 2006 was simply a year in which economy
153
did relatively well, with foreign investments pouring into the country.
Thus, although total spending did rise, the rise was not reflected in the
budget deficit, which is why our model appears to be ineffective. Similarly, in the period 2004-2008, Croatia was governed by a minimal coalition; again, this would have created good theoretical conditions for
the growth of deficits and debt, according to the hypothesis. However,
Croatia consistently reduced its budget deficit over those years, cutting
it from 3.65% of GDP in 2004 to 0.9% of GDP in 2008. The budget
consolidation appears to be more influenced by the growing economy
than the coalition type. Bulgaria presents a third example. From 2000
through 2008, its economy had an average annual growth rate of 5.76%.
Over the same period, Bulgaria was governed by a minimal coalition,
and it ran a budget surplus from 2004 through 2008, which also is contrary to the theory. The case of Romania partly confirmed our thesis:
From 2001-2008, it had a minority coalition, and the deficit declined;
but that lasted only until 2005, when the deficit started rising again.
In other cases, such as Estonia and Hungary, it is simply impossible to
establish a clear trend. It is difficult to tell, within such small number of
observations, what triggers which trend and how.
Regarding H1, we found that the number of parties is not a significant predictor of DEF and DEB, but it is a significant predictor for EXP
and our major dependent variable – SPE.
Our analysis from section 7 produced several interesting insights.
First, the most useful model we introduced is model 3, for which the
dependent variable is EXP. In this model, predictors explain much more
variance of the dependent variable compared to the other models. Most
important, from the standpoint of supporting our theory, in this model
the number of parties plays a significant role as a predictor. With model
3, we also explain a significant percentage of variance of DEF as our dependent variable. Our second model is somewhat weaker because the
percentage of variance for DEB is smaller, but it is still sufficient.
Our final model produced with the synthetic variable SPE is statistically the weakest one. This is due to the fact that some predicting variables have the opposite influence on the three separate variables which
cons.titute the composite score in question.
H1 claims that the number of parties in the coalition (NUP) influences public spending (SPE). Public spending is a synthetic variable
which consists of three separate variables: DEF, DEB and EXP. Curi154
Dušan Pavlović, Miloš Bešić
The Budget Dilemma and Public Spending:
Evidence from Ten Postcommunist Countries
ously, as shown in section 7 (Figure 20), the independent variable does
affect the major synthetic variable (SPE), but it does not affect each of
its components (DEF, DEB). However, this is explained by the fact that,
statistically, the effect of the variable EXP is so strong that it neutralizes
the statistical effect of DEF and DEB.
Hence, we need not worry that we found no correlation between
the number of parties (NUP) and budget deficit and public debt (DEF,
DEB), especially in the years when the economies under analysis were
growing (2000-2008). We contend that in the Budget Dilemma, the
more actors in the cabinet, the higher the level of public spending. The
only dependent variable that unambiguously confirms this claim is
public expenditure (EXP), which is the amount of resources a government spends within a certain time period as a percentage of GDP.
EXP outweighs DEB and DEF in our models. When an economy
grows, the government’s activities can be financed from higher revenues. When economy is doing well, even though public expenditure
rises, the deficit remains small and public debt does not increase. However, we do not see this during recession because most governments
then attempt to stimulate the economy by running a larger deficit, financed with debt. Therefore, during slumps or depression, we may see
an increase in all three variables (EXP, DEB, DEF).
Although we found some evidence that the number of parties positively affects public spending, from our analysis we cannot be absolutely certain that it is causation rather than merely correlation. Social
phenomena cannot be explained by general laws but rather by mechanisms (Swedberg 1998; Elster 2007; Demeulenaere 2011). To be sure
that, at least in some cases, the number of parties positively affects
public spending, we would have to open and look into the black box.
We would have to identify the causal chain which unambiguously confirms that an indispensable veto player blackmailed the rest of the cabinet and that resulted in higher spending. This task we leave for future
research, which would require a sophisticated multilevel model with
more control variables, and more descriptive and interpretative work.
Finally, as we predicted, the control variables in the model proved
to be critical in explaining overall government spending. It could be
considered an intuitive conclusion, since the variables in question are
155
economic in nature. By introducing these variables, we practically and
efficiently control the tested models identifying the importance of the
main independent variables that we set in the hypothesis.
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Institute for Political Studies
UDC 314.74+341.43(4-672EU)
Manuscript received: 29.08.2014.
Accepted for publishing: 04.09.2014.
Original scientific paper
Serbian Political Thought
No. 2/2014,
Year Vl, Vol. 10
pp. 159-177
Luka Glušac1
Secretariat of the Protector of Citizens
(Ombudsman) of the Republic of Serbia
Securitizing Migration in the
European Union:
from Openness to Ban-Opticon2
Abstract
This paper offers a view on why and how migrations have been perceived
as a security threat in the European Union. The underlining question posed is
how the ambition of EU nation-states to control the entry and movement of
people can be reconciled with liberal standards promoting human rights, open
borders and humanitarian values. The author uses the theory of securitization,
Didier Bigo’s concept of Ban-opticon and human security concept as theoretical grounds, while the normative and political discourse analyses are utilized
to show the EU practice. The intention is to show that while the number of
migrants has not been significantly change in the last years, the public perception is different, especially due to the Arab Spring. The EU, which integration
and long-time economic success would not be possible without constant influx of the immigrants, in the recent years developed people unfriendly migration control system. I argue that such system came as a result of several factors,
most notably societal securitization. As the Arab turmoil coincides with the
post 9/11 changes in security policies, economic crisis and the rise of far right
parties in several EU Member States, the migration issue has been increasingly
securitized. EU’s legal norms and methods follow such societal securitization.
Tight border control (including increased surveillance), usage of buffer zones
and externalization of border control are crucial EU methods of dealing with
migration. The author concludes that while migrations have a clear security
dimension, they are best addressed through rights-based policies.
Keywords: migration, securitization, European Union, Ban-opticon, human
rights, human security.
1 Junior Advisor
lukaglusac@gmail.com
2 The views expressed in this paper do not necessarily reflect the positions of the Protector
of Citizens.
159
Introduction
Migration and its consequences are not, by any means, a new phenomenon. Rystad noticed da one could reasonably claim that humankind’s entire history has been a history of migration (Rystad 1992:1169).
Migration is also a well-explored academic research field. When understood that 3,1% (apx. 214 million) of world’s population are migrants,
or in other words, that one out of 33 persons in the world today is a
migrant (IOMa), than it is clear why migration deserves its place as
an important multifaceted and multidisciplinary research topic. While
migration is under the constant radar of researchers, it comes under
the spotlight of the political establishment and general public mostly
when seen as a threat, often as a result of alleged boost of the number
of immigrants. Alleged, because most of the time, in real numbers, the
boost does not exist. In fact, the percentage of migrants has remained
relatively stable as a share of the total populations, increasing by only
0,2% (from 2,9 to 3,1), over the last decade (IOMa). The same trend
applies for the European Union, as well (EU Infographics 2014).
The International Organization for Migration (IOM) defines international migration as “the movement of persons who leave their country of origin or the country of habitual residence, to establish themselves either permanently or temporarily in another country” (IOMb).
In world made of Westphalian system’s nation states, where notion
of territoriality has been central to its formation, borders define territories. Thus, controlling who enters and remains on their territory is
an integral part of the sovereignty of states. Consequently, one of the
primary ways that sovereign nation states have contended with migration is through border enforcement mechanisms (Vietti & Scribner
2013:23). In the case of European Union (EU), migration is an issue
encountered on both national state and EU level.
I argue that migrations have been perceived as a security threat in
the European Union. I use the Copenhagen school’s theory of securitization, Paris school’s author Didier Bigo’s concept of Ban-opticon and
human security concept as theoretical grounds, while the normative
and political discourse analyses are utilized to show the EU practice.
The intention is to show that while the number of migrants has not
been significantly change in the last years, the public perception is different, especially due to the Arab Spring.
160
Luka Glušac
Securitizing Migration in the European Union:
from Openness to Ban-Opticon
The EU, which integration and long-time economic success would
not be possible without constant influx of the immigrants, in the recent
years developed a people unfriendly migration control system. I argue
that such system came as a result of several factors, most notably societal securitization. As the Arab turmoil coincides with the post 9/11
changes in security policies, economic crisis and the rise of far right
parties in several EU Member States, the migration issue has been increasingly securitized. EU’s legal norms and methods follow such societal securitization. Tight border control (including increased surveillance), usage of buffer zones and externalization of border control are
crucial EU methods of dealing with migration.
1. The EU Approach to Migration
There is a reach body of literature on the EU and migration issue.
Boswell identifies three sub-bodies of literature (Boswell 2010). She
argues that the initial one was highly descriptive and involved essentially normative critiques of the impact of harmonization on the rights
of immigrants (Ibid. 280). Explaining the institutional dynamics of this
harmonization is in the heart of the second strand of literature, while
a third one deals with the question of increasing EU cooperation by
drawing on literature concerned with the ‘politics of migration’ (Ibid.:
280-282).3
In practical terms, migrations are realization of one of the EU’s four
freedoms - the freedom of movement of people. Fostering the free
movement of people has been a major goal since the earliest days of
European integration, back in 1950s. While the internal migration has
been the cornerstone of the European Union, immigration of non-EU
citizens has often spark political tensions. Migration policy has been
one of the most discussed, with far more policy papers, than actual
formal decisions. There is no single migration issue that was easily
negotiated.
Since the Amsterdam Treaty, the EU and its Member States share the
sovereignty on issues of border control, asylum, and illegal migration
policies. The Lisbon Treaty further stipulates the EU has the competence to “[d]develop a common immigration policy aimed at ensuring,
3 Lavenex also identifies three subfields of enquiry. See: Lavenex (2010).
161
at all stages, the efficient management of migration flows, fair treatment of third-country nationals residing legally in Member States, and
the prevention of, and enhanced measures to combat […] illegal immigration” (TFEU Art. 79/1). It also enlists four migration related areas in
which the European Parliament and the Council, acting in accordance
with the ordinary legislative procedure, shall adopt measures, including: long-term visas, residence permits, family reunification rules, illegal immigration and unauthorised residence (removal and repatriation
of persons residing without authorization) (TFEU Art. 79/1).
One crucial element of the fight against illegal immigration has
been the return policy of the Union. Its key component is the signing
of readmission agreements, which enable EU countries to send back
these asylum seekers or migrants to a “safe third country.” The EU took
a decision in 2001 to incorporate the clause for signing readmission
agreements to all its external relations.4 The Lisbon Treaty incorporated that decision (TFEU Art. 79/3).
The consolidated Treaty on the Functioning of the European Union
(TFEU) also sets that the European Parliament and the Council, again
“[a]cting in accordance with the ordinary legislative procedure, may
establish measures to provide incentives and support for the action of
Member States with a view to promoting the integration of third-country nationals residing legally in their territories, excluding any harmonisation of the laws and regulations of the Member States” (TFEU
Art. 79/4, emphasis added). This provision is very important because
it shows that Member States are still very keen to keep the issue of integration of third-country nationals in their competence. Additionally,
the same article explicitly says that Member States retain the right to
determine admission rates for people coming from third countries to
seek work (TFEU Art. 79/5).
In order to implement the word of the Treaties, EU has adopted,
through the years, number of directives, covering: third-country nationals who are long-term residents in the European Union (Directive 2003/109/EC); family reunification issue (Directive 2003/86/EC);
highly qualified migrants (Directive 2009/50/EC); residence and work
permit (Directive 2011/98/EU); seasonal workers (Directive 2014/36/
EU); intra-corporate transfer (PE-CONS 58/14).
4 As a result, the migration issue once again proved to be par excellence political issue.
For example, Turkey and the EU initialed an agreement on the readmission of irregular
migrants, after seven years of negotiations.
162
Luka Glušac
Securitizing Migration in the European Union:
from Openness to Ban-Opticon
The adoption of legislation has followed the EU’s migration policy.
The EU shaped its migration policy through the European Council’s
Conclusions known as Tampere Programme (1999), Hague Programme (2004) and Stockholm Programme (2009). Those three programmes were followed by “The Global Approach to Migration and
Mobility” (GAMM), adopted by the European Commission originally
in 2005 with a renewal in 2011.
The so-called Tampere Programme outlined the Union’s policy on
migration with certain openness towards third country nationals on
one hand and “the need for more efficient management of migration
flows at all their stages”, on the other (European Council 1999: para 22).
It states that freedom should not be regarded as the exclusive preserve
of the Union’s own citizens and that it would be in contradiction with
Europe’s traditions to deny such freedom to those whose circumstances
lead them justifiably to seek access to our territory (European Council
1999: para 3).
The Hague Programme, adopted in 2004, shifted the EU’s attitude
towards migration, putting much emphasis on security issues (European Council 2004), as it follows 2003 European Security Strategy. It
linked the internal and external dimensions of security, developing
the concept of external dimension of asylum and migration (European Council 2004: 20). The Hague Programme also emphasized the
necessity of further capacity building in third countries in relation
borders control and asylum processing, namely externalisation. This
Programme also mainstreamed the readmission agreements in all EU’s
external partnerships. Institutionally-wise, the Hague Programme was
marked by the idea of the creation of a European integrated border
management system and of a specialised agency (European Council
2004: 23-25). That idea was later implemented in 2004 with creation
of the European Agency for the Management of Operational Cooperation at the External Borders (Frontex).
The Stockholm Programme, adopted in 2009, focused on the enhancement of the integrated border management (European Council
2010: 26), calling for further improvement of Frontex resources, capabilities and mandate (Ibid.).
While the three programmes are primarily focus on the EU internal
policy and capabilities, with evident increasing of the “external” elements, the Global Approach to Migration and Mobility (GAMM) has
163
been the EU’s framework for dialogue and cooperation with non-EU
countries of origin, transit and destination. GAMM is the overarching
framework for the EU external migration policy, complementary to the
EU foreign policy and development cooperation. The human rights of
migrants are a cross-cutting dimension, of relevance to entire GAMM”
(European Council 2011:6). GAMM stipulates that “[a]ll action must
be empowered to gain access to safe mobility” (European Commission
2011: 7), making it a migrant-centred approach. In sum, GAMM can be
seen as a two-faceted policy, combining the strengthening of the EU’s
own capabilities to control the external borders, and the externalisation
of migration management, meaning building third countries’ capabilities to effectively deal with migration flows.
A consistent trend in the EU migration policy since the Tampere
Programme is increasing externalisation of migration management. In
other words, the EU is trying to move migration control as far from
its borders as possible, imposing the responsibility to third states. Such
states include countries of origin and transit of migration involved in
the management of both legal and illegal flows. The externalization follows the standpoint taken in the European Security Strategy (ESS) that
““[t]he internal and external aspects of security are indissolubly linked”
(ESS 2003: 2) and “with the new threats, the first line of defence will
often be abroad” (ESS 2003:7).
In practice, the externalisation includes a wide range of actions, such
as the creation of detention camps, the repatriation of migrants and the
promotion of capacity building and development programmes in third
countries (Aubarell, Zapata-Barrero and Aragall 2009: 12). Similarly,
the EU actively supported the creation of buffer zones between the EU
and the countries of origin of the prevailing number of migrants. For
example, Libya is used as a key buffer zone for African migrants. “The
panic and hasty reversal of the Schengen agreement in the days following the Libyan uprising indicated the level to which EU states are
dependent on Libya as a buffer zone for irregular migrants. The EU
uses Libya to contain irregular migration by intercepting and detaining
irregular migrants in return for development aid” (Rotman 2012: 32).
The externalisation as the key component of the EU migration policy
has been highly controversial.
The strengthening security through border management is a longterm goal of the EU Internal Security Strategy (ISS). ISS, adopted in
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2010, identified four key actions aimed at strengthening security
through border management, where two are of high importance for
the migration issue: 1) exploit the full potential of Eurosur and 2) enhance the contribution of Frontex at the external borders. In the final
yearly Implementation Report of the EU Internal Security Strategy
2010-2014, published in June 2014, the European Commission stated
that an important measure is the entry into force at the end of 2013 of
Eurosur (European Border Surveillance System)5, a multipurpose system to detect and prevent cross-border crime as well as to contribute
to saving migrants’ lives at the external borders of the Schengen area. It
added that Frontex has been reinforced through the adoption of its revised legal basis. The Commission stated that comprehensive support
is provided to protecting the lives of migrants and further to alleviate
the burden of the most affected Mediterranean EU Member States.
In technical terms, border control results in increased surveillance.
Surveillance means the use of databases, especially biometric databases. The main database in use in Europe are Schengen Information System (SIS), which was recently upgraded and called SIS II, the database
for keeping the records of asylum applicants - EURODAC, and finally
the database where information on visa applications are stored, which
is called the Visa Information System (VIS). Moreover, since 2004 the
Union agreed on tracking the passenger data moving in and out of the
Union by air through a “Passenger Name Record” (PNR) system. Airline companies provide the data for this system through their booking
systems.6
Many, especially human rights advocates, have criticized the usage
of the full potentials of Eurosur and Frontex, as it produces increased
and inhumane surveillance. Contrary to the EU officials, they argue
that institutional and operational measures in force severely endanger
human rights. Despite the EU’s standpoint that its migration policy is
migrant-centred and both Eurosur and Frontex “contribute to saving
migrants’ lives” they are, actually, seen as a threat to realization of immigrants’ human rights. The SIS was originally created to fight transnational crime and to search for missing persons more easily. Nevertheless, today, “the SIS functions as a database that maintains dossiers
on individuals in order to prevent illegal immigrants from returning
5 Regulation (EU) No 1052/2013 establishing the Eurosur.
6 More information in: Benam (2011).
165
to the EU. Around the turn of the millennium, police authorities were
still denying that the Schengen system was set up in order to provide a
policing body for immigration, but that time is past (Lebbe 2011: 88).
Didier Bigo, the leading figure of the Paris School, sees the SIS as a
profiling apparatus. According to him, “the main focus of the system
is to ensure that persons who are or might be considered unwanted
by any participating state are not permitted into the territory. Thus the
rules focus on who must be excluded and provide little guidance on
who should be admitted” (Bigo 2005: 46).
Further, Bigo argues that the EU has been constructing a “Ban-opticon” like structure. In a “Ban-opticon” certain groups are selected as
target groups, as potential criminals, as risky groups and are subjected
to increased surveillance, whereas movement for the rest is facilitated.
In Europe the group, which is the subject of surveillance, consists of
illegal immigrants and asylum seekers. Instructively, he has described
this notion as a shift from the pan-optical to the ban-optical. Whereas
in the pan-opticon everybody was subjected to the disciplining gaze,
Bigo defines the Ban-opticon as a regime of practices where specific
groups are blamed already before they have done anything, “simply by
categorising them, anticipating profiles of risk from previous trends,
and projecting them by generalization upon the potential behavior of
each individual pertaining to the risk category” (Bigo 2002: 81).
The whole system has been justified as a migrant-centred and human rights-led from a day one. It seems that it lost that individual touch.
It is not primarily regarded on the level of the individual as a matter of
the “rational selection of high-risk spaces, high-risk people, or risk factors” (Valverde 2004: 438).
Buffer zones (i.e. processing centres and regional protection zones)
can also be regarded as an indication of the desire to categorize populations in terms of the potential harm they pose (Van Munster 2005). The
other problem arising from usage of buffer zones is the fact that many
of buffer zone countries are not parties to core human rights conventions. For example, Libya, key buffer zone, is not a signatory to number
of international human rights law conventions, such as the 1951 Refugee Convention, that guarantees non-refoulement. Therefore, Libya
cannot be accountable for abuses against transiting migrants through
the country. The EU leaders have been criticized for using authoritarian regime in Tripoli as its overseas border control and closing their
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eyes at the clear inhuman treatment of migrants detained in camps7.
It seems that EU applies double standards. On one hand, it embedded
the highest human rights standards and value in its founding treaties.8
Reaching the human rights standards is conditio sine qua non for the
EU membership. On the other, the practice of externalisation of the
migration control, i.e. building of detention camps and buffer zones,
raises legitimate questions of human rights violations9 both on the side
of EU and its ”migration partners”. Additionally, while the freedom of
movement of people is one of the fundamental rights, both in the EU
and internationally, the EU in its relations with third countries, especially candidate countries and potential candidates, effectively undermines its realization. It calls potential members to enable full realization of human rights, including the freedom of movement, but then it
threatens to suspend visa-free regime if the number of asylum seekers,
and migrants in general, exceed the “comfortable” number.
2. Less Visible Drivers of the EU Migration Policy: Lampedusa
Effect
When the evolution of the EU migration legislation, policy and the
institutional arrangement is presented, as well the critics of EU practice, it seems helpful to try to highlight the less visible drivers of EU
normative and operational actions with regard to migration.
The Arab Spring has been an important factor. The loss of Libya
as a buffer zone due to uprising certainly influenced the speeding up
of adoption of some EU‘s operational measures to fight undesired
migration, such as establishing of the Eurosur and strengthening of
the Frontex. Despite that, the influx of migrants from North Africa
caught EU unprepared. EU panickly responded. Italy declared a State
of Emergency and France responded to the ‘threat’ of irregular migrants by closing its borders with Italy (Rotman 2012: 27). Nevertheless, it would be wrong to assume that the influx of migrants from
North Africa was overwhelmed, quantitatively speaking. In fact, “migration to Europe has not been accelerated by the Arab Spring, apart
7 See for example: http://www.theweek.co.uk/politics/6515/how-libya-kept-migrants-outeu-any-cost
8 See: TEU, Art. 2 and 3.
9 See for example: Human Rights Watch (2011); or Amnesty International. (2014).
167
from a short-lived movement from Tunisia, but has simply continued
along previous trends” (Fargues and Fandrich 2012: Exe. Sum). The
official EU data corresponds. The number of non-EU nationals residing in the EU has a steady trend. They make in average 4% of the EU
populations, from 2010 to 2013 (EU Infographics 2014). The number of immigrants in the EU is actually in decrease since 2010 (data
as of 2012). In 2011 there was 4% decrease (from 1.455.953 in 2010
to 1.399.934 in 2011), while in 2012, the decrease was almost 20%
(1.170.665) (EU Infographics 2014).
While the number clearly shows that the immigration has not been
increased, the public perception is quite different and testifies on the
complexity of the issue in EU Member States. While there have always
been opponents of multiculturality in the EU, particularly on far-right
part of political diapason, the economic crisis and the perceived increase of migration flow due to the Arab Spring boosted the anti-immigrants discourse in many EU states. The extensive media coverage of
several sea accidents during the Arab Spring, most notably the Lampedusa shipwreck10, contributed to the anti-immigrant discourse painted
with terms such as “tsunami of immigrants” or “invading immigrants”,
despite the fact that route from Libya to Italy has been one of the most
frequently used Mediterranean routes for migrant transfer for decades.
Additionally, the majority of the people died in Lampedusa tragedy were Eritreans, i.e. non-Arab Spring related migrants. This “Arab
Spring’s tsunami of immigrants” actually serves as a supporting material for the anti-intergration and anti-multiculturality discourse. The
“undesirable” (im)migrants have been perceived as a burden for the
European cultural composition due to their effects on the weakening
of national traditions and societal homogeneity (Huysmans 2000:758).
That is a key message of far-right parties in the EU Member States who
link migrations with political (in)stability by labeling migrants as a key
threat for collective identity and therefore create an artificial “Other”.
The Austrian and Dutch politicians are among most voiced, including
Geert Wilders who talks about “Islamisation of the Netherlands”, late
Pim Fortuyn and Jörg Haider, Jean-Marie Le Pen in France, etc. Occasional public statements of Government officials (un)purposely supports this far-right view. Most notable was the statement of the German
10 When a boat carrying migrants from Libya to Italy sank off the Italian island of
Lampedusa.
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chancellor, Angela Merkel, who has courted growing anti-immigrant
opinion in Germany by claiming the country’s attempts to create a
multicultural society have “utterly failed” (Guardian 2010). She added
that the onus was on immigrants to do more to integrate into German
society (Guardian 2010). Her comments heated a debate about immigration in Germany, which is home to around four million Muslims.
3. Has Securitizing Resulted in a Successful Securitization?
Labeling the migrants as “Other” prevents their integration in the
society. In the same time, it contributes to their exclusion and construction of the image of migrants as a threat. In Copenhagen School’s
terms, the migration issue has been securitized. Actually, securitization
of migration is one of the most studied examples in societal security
sector11, where the vast majority of scholars stand by the opinion that
the EU has indeed securitized the migration issue.12
I see two leading contributing factors to securitization of migration
in the EU. For the first, I follow Brochmann, who noted that the most
probable ground for securitization of migration could be a tendency in
most receiving countries to highlight flows of people rather than individual human beings. That “reinforces the threat images of immigration and has contributed to a tendency of politicization of immigration”
with the utilisation of metaphors like ‘flood’, ‘invasion’, ‘hungry hordes’
(Brochmann 1999: 331). Despite the fact that the migration flow has
not increased, as already shown, the picture painted in the public is different. This call for the defence from invaders plays on both subjective
and objective elements. By subjective, I mean people’s fears and insecurity and, on the objective side, it builds on the negative impacts of the
economic crisis, i.e. austerity and less employment opportunities. The
second factor is economic crisis and its negative influence on the labor
market and social aid funds in the Member States. Immigrants come as
the easiest group to blame, as “job thieves” and social aid beneficiaries.
It should be noted that the perception of immigrants as economic or
welfare burdens depends on the receiving society’s economic situation.
In a prosperous and growing economic time, the ‘same immigrants’
11 See for example: Roe (2005); Herd, G. P. and Lofgren, J. (2001); Kelstrup (1995);
Huysmans (1995) Thranhardt; Huysmans (2006).
12 Rare exception is: Boswell (2009).
169
who are seen as welfare burdens can be perceived, instead, as necessary
for the maintenance of economic growth.
In practical terms, one of the most negative consequences of the
securitization of migration is the growth of racism and xenophobia in
the society. Securitization makes the inclusion of immigrants in European societies more difficult while further diminishing the chances of
promoting multicultural policies.
Theoretically, an issue to be securitized it has to be presented as
an existential threat, the actor has to claim a right to handle the issue through extraordinary means, to break the normal political rules
of the game (Buzan et al. 1998: 24). Stricto sensu, the changes of EU’s
migration legislation and policies have indeed been made within the
proscribed legislative and political procedures. Nevertheless, it seems
wrong to conclude that securitization did not occur. The threshold for
securitization does not demand the adoption of an emergency measure, but “only that the existential threat has to be argued and just gain
enough resonance for a platform to be made from which it is possible to
legitimize emergency measures or other steps that would not have been
possible had the discourse not taken the form of existential threats”
(Buzan et al. 1998: 25). This “lower” threshold has to be applied in the
EU case because the complex technocratic nature of political, legal and
institutional processes in the EU means that policy outcomes can hardly resemble the ones in nation states. In other words, it is questionable
whether any of the EU institutions have the constitutional, institutional, political or legal capacity to use extraordinary means or violate rules
that otherwise would bind (Neal 2009: 5).
In the EU case, the drivers of the migration policy and law have been
opposite to the EU values, enshrined in the Treaties. The discourse, as
presented above, led EU to push and adopted less migrant-oriented and
more security-led policies. No one questions the importance of security
side of the migration issue, but the system of the migration control in
the EU created a paradox. Every individual migrant is subjected to the
increased surveillance, biometric checks and administrative obstacles.
All migrants are labelled as a risk category, so they are discriminated as
a group and its every member is subjected to the negative generalization. Therefore, as a consequence of securitization, the migrants are
individually checked, but collectively assessed.
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4. Towards a More Human-Based Approach
The main strongholds of human based approach to migration are
international human rights instruments. While states have sovereign
right to regulate the entry, stay and movement of migrants and their
policy on immigration, they have to keep in mind the international obligations they have assumed in the area of human rights. Human rights
are provided with an extending scope of institutional mechanisms at
the multilateral level with clearly articulated and widely accepted legal
notions for legislative and practical responses.13 The pressure to respect
those rights is necessary, because, as Special Rapporteur of the Commission on Human Rights observed despite the fact that these basic
rules of human rights are applicable to non-citizens, the actual circumstances of migrants, particularly those with irregular administrative
status, do not match the ideas reflected in the international human
rights instruments (UNGA 2004: 11).
Though leading international human rights NGOs, such as Human Rights Watch and Amnesty International have strongly voiced the
violations of the rights of migrants, including by the EU institutions,
stronger international governmental pressure should follow.
The human rights approach can be combined with the human security concept, as it is widely recognized that the human rights are the
vital core and normative foundation of human security and that two
approaches are reinforcing each other. It is a fact that studies on migration have mainly focused on the human rights approach with little
attention on human security. Human security can be useful because of
its inclusiveness, definitional expansiveness and people-centrism. Nevertheless, as Paris noted “definitional expansiveness and ambiguity are
powerful attributes of human security, but only in the sense that they
facilitate collective action by the members of the human security coalition. The very same qualities, however, hobble the concept of human
security as a useful tool of analysis (Paris 2001: 102). Thus, the precondition for more human security oriented migration studies are further
13 The 1948 Universal Declaration on Human Rights and two international covenants
proclaim the civil, political, economic and social rights of all people. The 1993 Vienna
Declaration of Human Rights stresses the universality and interdependence of the
human rights of all people. Particularly for migrants, there is the UN Convention on the
Protection of the Rights of All Migrant Workers and Members of their Families.
171
development of the theoretical and methodical apparatus of the human
security concept, as it is perceived as vague and underdeveloped.14
The main advantages of human security approach with regard to
migrants could be the emphasis of the multiple factors that give rise
to migration flows, including economic deprivation, political persecution, and ethnic cleansing, and would seek to address these conditions
before they lead people to migrate (Thakur 2003: 5).
The human security approach could be especially useful when dealing with conflict-induced migrants and criminal-induced migrants, i.e.
victims of human trafficking. The irregular migrants are in particularly
disadvantaged position. They often work in precarious and dangerous
jobs; they are excluded from health, education and other social welfare provisions, and they can be subject to exploitation in the housing
market (le Voy et al. 2004). Their status often makes them unwilling to
engage with authorities.
The United Nations system, the birthplace of the human security
concept seems to be the right environment to advocate for a more human rights/security approach. Its Commission on Human Security has
already recognized that migration is vital to protect and attain human
security, although their human security may also be at risk while they
are migrating (CHS 203: 41).
Migration is one of the issues that are in the centre of the securityrights nexus. Migrations have a clear security dimension, but they are
best addressed through rights-based policies. The way forward in the
EU case is twofold. The first is to continue the ceased activities in embracing and implementing the human security concept. In other words,
Barcelona (2004) and Madrid (2007) reports of the Human Security
Study Group should be followed-up. The second is relocation of the external “migratory relations” from DG Home (European Commission’s
Directorate-General for Home Affairs) to EEAS (European External
Action Service). So far DG Home has lead the negotiations with third
countries and acted almost completely autonomously from the EEAS
in transmitting the EU standpoints to third countries’ authorities.
That is despite the fact that Lisbon Treaty gave a leading role in setting
strategies and priorities for EU foreign affairs policy to the EEAS. The
main negative consequence of such development is enshrined in the
14 See for example: Chandler (2008); Lipovac and Glušac (2011).
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DG Home’s view on migration, marked by narrow lens of its expected
short-term effect on the security of EU Member States. The result is
a restrictive stance on human mobility policy, in which the overriding concern is to stem irregular immigration (Carrera et al. 2013: 4).
Additional result, as already argued, is engagement with undemocratic
third states through readmission agreements and buffer zones deals.
Those engagements utterly negate the founding values and wording of
the EU treaties saying the cooperative relations with the neighborhood
have to be “founded on the values of the Union”, including the respect
of fundamental rights (TEU Art. 89). The solution is to follow the Lisbon Treaty and hand over the migration foreign relations to the EEAS
which would much more take into account the broader sectoral issues
at stake in the EU’s wider negotiations with third countries, including
the human dimension.
Conclusions
As Gammeltoft-Hansen correctly noted, key EU dilemma in dealing with migration is “How may the ambition of EU nation-states to
control the entry and movement of people be reconciled with liberal
standards promoting free markets, open borders and humanitarian
values?” (Gammeltoft-Hansen 2006: 1) At the moment, the reconciliation is not going easy. In time of austerity, omni-present surveillance,
uncontrolled conflict-caused migrations and the renewed calls for reevaluation of multicultural model, the EU struggles to reconcile its traditional liberal, human rights-led policies with the emerging threat to
the sustainability of attained level of welfare.
The evolution of the EU migration policy and law is marked by increased externalization of migration control in combination with buffering and border control. The EU’s externalization method is, in practical terms, a sort of “policing at a distance” (Bigo 2002).
The established system of migration control, despite official presentation as a migrant-centred and rights-led, turned to be a threat to both
human rights and human security of the migrants. The migrants are
presented as risky, criminalized, group that have to be put under special
surveillance, without proscribing the clear and individualized case-bycase procedure. The migration policy is motivated by security concerns
much more than migrants’ welfare, as the migrants are perceived to be
173
a treat to the European Union. The changes of the EU migration policy
and law present a case of successful securitization.
No one denies that migration is a security issue. In fact, migrations
are one of the issues that are in the centre of the security-rights nexus.
Migrations have a clear security dimension, but they are best addressed
through rights-based policies. If the methodological apparatus of the
human security concept successfully evolves, a human security approach to migrations could potentially serve as a middle ground.
In EU internally, the solution is “desecuritization and the parallel repositioning of migration to the realm of normal politics, which means
the repoliticization of the issue” (Jutila 2006). In foreign migratory relations, EEAS has to take over the negotiations with third countries form
DG Home, in order to take into account the broader sectoral issues and
human rights guarantees.
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Muster, R. (2005) Reconfiguring Authority: Neo-Liberal Governmentality, Security and Immigration Control in the EU, [online]. Avaialble at:
http://www.sam.sdu.dk/politics/nisa/papers/rv_munster.doc[Accessed
15 August 2014].
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177
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Institute for Political Studies
UDC 341.218.4+341.231:342.573(4)
Manuscript received: 15.09.2014.
Accepted for publishing: 21.10.2014.
Review article
Serbian Political Thought
No. 2/2014,
Year Vl, Vol. 10
pp. 179-192
Aleksandra Mirović1
Institute for political studies, Belgrade
Petar Matić2
Institute for political studies, Belgrade
Regional Separatisms and Independence
Referendums in Europe3
Abstract
This paper explores the issue of regional separatisms and referendums on
self-determination in Europe. These disintegration processes run counter to the
ongoing universal trends of globalisation and global market creation. Although
international legal documents define the self-determination as a right vested
only in sovereign nations, aspirations of this kind are in practice increasingly
exhibited by minority groups and nations. Furthermore, in some situations we
are witnesses of double standards on self-determination, particularly remarkable in the case of Kosovo and Metohija. However, these disintegration processes are not confined to the states of the former Eastern Block, but are also present
in the well-established and developed democracies boasting a broad spectrum
of minority protection rights. These trends are particularly present in southern
member-states of the EU, eroding its very foundations built on the idea of a
united Europe as a multiethnic, multilingual and multicultural creation.
Keywords: regional separatism, referendums, globalization, selfdetermination, dezintegration, international law, double standards.
The world of today is marked by the dynamic and vigorous integration processes, dominated by a Western-style model of globalisation
and the ever growing interdependence of contemporary societies. Yet,
1
2
3
Research associate
laleksandramirovic@yahoo.com
Research associate
pmatic75@gmail.com
This paper was prepared in the scope of the research project „Democratic and national
capacities of the political institutions of Serbia in the process of international integrations“
(179009), funded by the Ministry of education, science and technological development of
the Republic of Serbia.
179
despite or mainly because of this, the 21st century globalised world is
confronted with the rising disintegration challenges generated by regional separatisms, threatening to radically reshape the existing political
map and relations of geopolitical power.4 Consequently, integration and
disintegration are both global political trends running concurrently.5
Antonio Cassese’s was correct in saying that: „In every corner of
the globe peoples are claiming the right to self-determination“ (Cassese 2011). But in this pursuit, the majority of them faces unsurmountable hurdles related to the specific question addressed in this paper :
„To what extent do international law-makers embrace the political
postulate of self-determination in the sphere of legal norms“ (Institute
of National Strategic Studies 1999). Actually, in the background of all
separatist processes and disintegration tendencies, or associated issues,
stands the collision of some international legal norms. To be more specific, stemming from the existing body of international legal formulations is the basic contradiction and mutual exclusion of the principle of
peoples’ self-determination and the principle of respect for territorial
integrity and political unity of internationally recognised states, as major principles in international law. Namely, there is an evident lack of
legal, but above all, political will to arrive at better solutions with more
precise formulations in international law and to secure their full universaly binding observance.
Peoples’ right to self-determination is an obscurely defined and ambivalent international legal standard, subject to possible dual interpretation as it concerns minority groups, whether they be racial, religious
or other. While, on the one hand, word-for-word interpretation precludes any right to secession, on the other hand the so-called logical
interpretation allows for its approval and justification under certain
conditions. Cassese refers to such dual and ambiguous structuring of
the formulations of self-determination, featuring both excessive literary style and dry legal jargon: „...we will continually confront such formulations which characterize self-determination with the flowery and
4 More on the parallel unfolding of the integration and disintegration processes in the
modern world, or the globally driven dialectic of contradictory processes of integration,
disintegration and reintegration, see: Mirović (2014).
5 It is interesting to note that the same conclusion was stated in the Washington-based
Institute of National Strategic Studies Strategic Forecast for 1999, i.e. already at the turn
of the 21st century. However, it emphasizes that such global dynamic is not only a threat
to stability and progress, but also to the interests of the US and its allies (See: Institute of
National Strategic Studies Strategic 1999: 1–18).
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Aleksandra Mirović, Petar Matić
Regional Separatisms and Independence
Referendums in Europe
loose rhetoric of freedom and liberation; and yet couch its operative
terms in the dry and tight language of legal disclaimers, substantially
excluding any secession from existing States (Cassese 2011).“
Namely, the principle of self-determination (or self-defining) (Cassese 2011: 5) had long featured in international relations only as a political principle assuming the status of international law standard only in
the 1960’s and, according to some interpretations, the 1970 UN Declaration on Friendly Relations accords the right to secession to racial
and religious groups - but only implicitly, on the strength of the aforementioned logical interpretation of its so-called saving clause.6 That
said, in Cassese’s reading, it is applicable only in specific circumstances
and must be exercised with rigour: „It can be said the the Declaration
on Friendly Relations links external self-determination with internal
self-determination only in exceptional circumstances. A racial and religious group may attempt secession, a form of external self-determination when it is evident that internal self-determination is not feasible
in any way “ (ibid, 144). The author of this paper believes that a triple
pre-requisite is to be fulfilled for the secession, the most radical form of
external self-determination, to be legitimate and thus, recognized. This
triple pre-requisite implies: first, that the central authority of some sovereign state persistently contests the rights of a religious or racial group
to representation, i.e. that it refuses to grant participatory rights to religious or racial groups; but this by itself does not provide sufficient basis
for the legitimacy of secession, but there should be, second, a gross,
flagrant and systematic violation of their fundamental human rights,
and the third pre-requisite, absence of any prospect whatsoever of
reaching a peaceful settlement within a given state structure. (ibid.) In
their statements, Western campaigners for the Kosovo independence,
6 UN Declaration on Friendly Relations from 1970 deals mainly with external selfdetermination, while internal self-determination remains of secondary importance;
the latter and its link with the former aspect of self-determination are dealt with only
indirectly by the so-called saving clause, whose interpretation leads to the conclusion
that „since the possibility of the fragmentation of territorial integrity is not completely
dismissed, it is logically recognized” (Cassese 2011: 143). Hence, although largely
overlooked, this clause is of great importance. It reads: „Nothing in the foregoing shall be
construed as authorising or encouraging any action which would dismember or impair,
totally or in part, the territorial integrity or political unity of sovereign and independent
States conducting themselves in compliance with the principle of equal rights and
self-determinaiton of peoples as described above and thus possessed of a government
representing the whole people belonging to the territory without distinction as to race,
creed or colour“ (Ibid.: 137).
181
when attempting to legitimize seccession they facilitated for the local
Albanians and simultaneously de-legitimize the same right to Crimea,
we can discern an intention to rely on this „implicit logic“ in interpreting the earlier-mentioned saving clause from the 1970 UN Declaration.
However, whether Cassese’s rigid triple pre-requisite and his requirement for exercising rigour in giving consent to secession have been met
or not, it cannot – although as we are witnessing it is common practice
nowadays – be subject to arbitrary arguments motivated by daily politics. In any case, the issue of the degree of discrimination against some
people needed for legitimate seccession remains open.
The above, less than precise formulations of self-determination were
the product of a compromise between, on the one hand, the Western
standpoint and the position of of other states, on the other. Western
countries at the time claimed their commitment to the universal recognition of self-determination not only due to their liberal ideologies, but
also because they saw in it an instrument of leverage against socialist
regimes. But, as we can see today, for example in the case of Crimea,
Western states have demonstrated that they are prepared to digress
from their positions and their ideologies when these stand at odds with
their geostrategies and geopolicies. It is important to note that, despite
some affirmation in international law of the right to self-determination, including the right to secession, and despite the western states’
proclaimed commitment to its universal applicability, in state practices
of a vast majority of states, and of the western states themselves, a negative attitude to secession prevailed until the end of the 20th century,
together with the practical denouncement of any rights to its exercise,
since the principle of territorial integrity and sovereign rights were regarded as supreme values.
In the recent years and decades, with the exception of the case of Yugoslavia, attention has been in particular on those desintegration and
separatist processes and tendencies in the countries of the so-called
First World or Western European countries, but also in the western
hemisphere in general, and then such processes and attempts in Eurasian coutries. However, it is important to say the same or similar tendencies occur outside these areas, or elsewhere in the world.
When in the early 1990’s, we saw the collapse of all East European,
socialist multinational federations, in two of the three of these states
(with the only exception being Czechoslovakia, where there was a civi182
Aleksandra Mirović, Petar Matić
Regional Separatisms and Independence
Referendums in Europe
lized i.e. peaceful and agreed separation of Czech Republic and Slovakia), namely in the case of Soviet Union and Yugoslavia, not only did
the central, federal structures disintegrate, but the process also spread
to some new post-Soviet and post-Yugoslav states. When it comes
to the post-Soviet space, one should only recall the proclamation of
unrecognized Armenian Republic of Nagorno-Karabakh on the territory of Azerbaijan; then, also the creation of internationally unrecognized so-called Predniestrian-Moldovan Republic; the case of Gagauzia, which was a de facto independent state in 1991-1994 and was
subsequently integrated in Moldova’s system as an autonomous region;
then the case of Georgia and its breakaway territories of Abkhazia and
South Ossetia that were recognized by Moscow who entered into a war
with Georgia in 2008; establisment of a de facto independence of the
Chechen so-called Republic of Ichkeria in the First Chechen War etc.;
until the latest case of the secession of Crimea from Ukraine and its
reintegration in the Russian Federation, and then, the ongoing creation
by pro-Russian separatist forces of two new self-proclaimed and unrecognized states on the territory of East and South-East Ukraine – the
so-called Donetsk People’s Republic of Lugansk People’s Republic and
their unification in the newly-formed joint state called New Russia (or
Novorossiya). In other words, the majority of post-Soviet states are
characterised by different types of inter-ethnic conflicts. Beyond that,
as some studies done in early 1980’s showed, virtually all former Soviet
republics had, and some still have, some kind of border dispute with
their neighbours. (Payin, 1996)
Also, with the breakup and disintegration of SFR Yugoslavia, in the
form of its complete fragmentation along administrative boundaries,
the principle formulated by the famous Badinter Commisison (in its
Opinion no.3, the implying that the boundaries between former federal units were to be considered as state borders and that they could
not be changed by force),7 disintegration processes did not cease but
continued to unfold in one way or another within the majority of the
newly-created ex-Yugoslav. Moreover, strengthening of some separatist
hotspots raises justified fears exist that they are still ongoing. But, apart
from a few desintegration processes faced by Croatia and FYR Mace7 Arbitration Commission chaired by Robert Badinter, President of the French
Constitutional Court, operating in the framework of the Peace Conference on Yugoslavia
and established by the EEC Council of Ministers in 1991, in order to settle legal disputes
arising from the dissolution of SFR Yugoslavia.
183
donia and the fact that a certain disintegration paradigm was incorporated into the constitutional foundation or organisational structure
of BiH – given the unsustainability of the formula of two entities and
three constitutive ethnicities, the Republic of Serbia is actually the only
one that underwent several cycles of desintegration – from the fragmentation of SFRY, collapse of SRY and the State Union of Serbia and
Montenegro, to its own internal desintegration manifested in the illegal
secession of Kosovo and Metohija. On top of that, some disintegration
forces continue to be active on the territory of Serbia, so even today, it
remains exposed to constant separatist threats and challenges of its further territorial dispersion (potential hotspots of disintegration such as
Vojvodina, Raška, South Serbia, etc.). Hence, it can be reasonably stated that the long-lasting process of the destruction of Serbian space, in
which Serbia itself is being decomposed, has already reached the point
of the „destruction of the nations’s territorial and mental nucleus“8.
The case of Kosovo and Metohija’s secession, carried out illegally
by the local Albanians in 2008, without a referendum and in the form
of the unilaterally declared independence of the so-called Republic of
Kosovo, is in fact a striking example of the enforced and illegal desintegration of a sovereign and internationally recognized state – the
Republic of Serbia, which besides is also one of the founding countries of the United Nations as a state successor of the former SFRY. It
is particularly important to underscore that in the case of Kosmet, for
all the denials coming from its chief constructors, an international precendent was created since it was the first time in practice that the right
to self-determination including the right to secession was granted to a
national minority – Kosovo Albanians – that was previously applicable
only to constitutive nations, and even then not in the form of self-proclaimed independence. Despite arduous efforts by Western officials,
intended to show tby arbitrary interpretations of international legal
norms, that the so-called Kosovo would be an isolated case with no
bearing on other, similar cases, what emanated immediately for some
and later for others was that the Kosmet case had set a most critical
8 Commenting on the process of destruction of the Serbian space back in 2001, Miloš
Knežević gave a warning projection which subsequent developments proved right. He
said: „If the dismemberment of the second Yugoslavia signified the destruction of the
Serbian space within the re-composed Yugoslav space, then the partition of Serbia and
Montenegro would mean the destruction of the least conceivable union of Serbian lands,
and the potential decomposition of Serbia would mean the destruction of the territorial
and mental nucleus of the nation“ (Knežević 2002: 133).
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Aleksandra Mirović, Petar Matić
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precedent with far-reaching consequences and the inevitable boomerang effect. Hence, today’s narratives of the same origins to the effect
that the so-called Kosovo and Crimea cannot be compared, remain –
especially in the light of the latest events, nothing but empty rhetoric.
Clear as it is that these cases cannot be compared, this is not because
of the calculated and strained interpretation that in the case of Kosovo
the right to secession is justified by large-scale violence and the alleged
systematic discrimination against the Albanian minority, while, in the
other, Crimean case it does not apply, supposedly because of a „more
democratic treatment“ of the Russian and pro-Russian population of
the peninsula.9 Actually, their comparison is not possible due to the
fact that these two territorial units had a different formal and legal status (with different degrees of autonomy) within the frameworks of the
state systems of Serbia and Ukraine. Unlike the Autonomous Province
of Kosovo and Metohija, Crimea – as an Autonomous Republic – no
doubt had a certain legal and status basis for exercising the right to external self-determination. Beyond that, a democratic referendum procedure was conducted in Crimea, considered to be one of the principal
indicators of the legitimacy and legality of secession acts in some other
cases i.e. some of the former Yugoslav republics (Mirovic 2014).
But, for all their intensity, dynamics and depth, Western integration
processes have not succeded in eliminating the separatist, desintegrative tendencies that exist within Western states themselves – like the
old and well-known cases of the Basque Country, Northern Ireland
and Quebec and some other re-kindled hotspots of desintegration
like, for example, the ethno-linguistic divisions in Belgium, the case of
Catalonia, Scotland, even France, then the aboriginal populations in
Australia, US and Canada, etc; until the most recent examples of disintegration tendencies of Texas, Alasca or the Region of Veneto in Italy.
9 In the run-up and immediate aftermath of the Crimean referendum on the region’s
attachment to Russia, various representatives of western institions, but also some wellknown, politically active thinkers and analysts as western propaganda advocates, were
voicing sharp criticism of the referendum itself and Russia’s stance during the Ukraine
crisis (like Zbigniew Brzezinski and Bernard Henri Lévy) on a daily basis, aimed at
– it seems – challenging the legitimacy of the local population’s right to external selfdetermination. Media content analysis clearly points that way. See for example „OSCE:
Referendum in Crimea „illegal“, source: Tanjug, Politika, 13 March 2014, p.2; „F̈ule:
Referendum as a Threat to European Borders“, source: Tanjug, Politika, 13 March 2014, p.
2; Brzezinski (2014); Brzezinski (2014a); Ana Otašević, „Kad političari ratuju metaforama:
Тако su i Srbi postali nacisti“, 09.03.2014, http://www.politika.rs/rubrike/Tema-nedelje/
Kad-politicari-ratuju-metaforama/Tako-su-i-Srbi-postajali-nacisti.sr.html (22/03/2014).
185
But, as separatist processes and tendencies were gaining momentum
and becoming particularly remarkable in Western Europe, this issue
has attracted attention not only by the media and analysts, but also of
scholars and researchers world-wide. Moreover, when in some Western European cases, there are serious indications that the transnational
and supranational European integrations and the current globalisation
model served as incentive for the internal desintegration tendencies
within national borders.
When it comes to the so-called right to self-determination including the right to secession or external self-determination, we can say
that this year has been marked by a certain „referendum fad“. The
referendum season launch was announced for autumn 2014 with the
Scottish balot slated for September 18 and Catalonia having attempted
for a while, although without much success, to secure Madrid’s consent
for a similar referendum in November and in the absence of consent
from central Spanish authorities, the Kosovo option was not dismissed
– a possibility for the Catalan Parliament to declare independence unilateraly, without a referendum (Šuvaković 2014). However, as it turned
out, the season had been launched much earlier, with the sucessful
Crimean referendum on this autonomous territory’s secession from
Ukraine and its integration in the Russian Federation. But, in terms of
efforts to legalize an legitimize separatism, „Pandora’s box“ had been
opened with the considerable international recognition of the secession of Kosovo and Metohija from the Republic of Serbia.
Within a short time following the Crimean referendum, an informal and multiday on line referendum in the Northern Italian Region of
Veneto was organised. Although such ballot-casting has no legal effect,
it showed great support by the local population to demands for organising a fully-fledged referendum. According to results released by the
media, more than 89% of the Veneto region residents voted in favour of
its independence from Rome and statements by independist activisits
clearly indicate the main reasons for such a sentiment of the region’s
citizens were economic crisis and fiscal pressures by the central authorities in Rome.10 Following boisterous campaigns by unionists and
independence supporters in Great Britain, in the referendum held on
18 September 2014, Scots rejected the independence option by a ma10 Source: “89% of Veneto residents vote for independence from Rome”, RT News, Mart 23,
2014, http://rt.com/news/venice-votes-independence-italy.585/). (31/03/2014).
186
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Referendums in Europe
jority of 55,3% votes (the electorate had some 4,3 million eligible voters, with a turnout rate of 84,6% or 3.619.915 people).11 However, since
London pledged – provided Scots decided to stay within the common
state - greater powers to be transferred to the Scottish parliament in
the sphere of finance, tax and social policy, it remains to be seen what
further steps will be taken to follow up on this pre-referendum promise, particularly in view of the latest outcries for greater powers among
the English and the Welsh. It became evident that the issue of Scotland
gained enormous importance, particularly since it was an affair concerning not only Britain and Scotland, but also the EU as a whole and
given that the future of a major global actor was at stake and thus, global
power relations, too. But also because the outcome of the Scottish referendum – as a potential precedent in international relations in case of a
„yes“ vote, was impatiently awaited by many other regions harbouring
separatist aspirations within Europe and elswhere in the world.
Similar separatist aspirations are harboured in the Spanish region of
Catalonia, where the movement for independence was created in early
20th century. In 1931, a coalition of the Catalan nationalist parties won
the largest majority of votes in the local elections, prompting Spanish
authorities to accord broad-based autonomy with many independent
institutions to the region. Some time later, during Franco’s dictatorship
regime, these institutions and the autonomy of Catalonia were completely dissolved. After the end of Franco’s dictatorship, Catalonia’s autonomy was restored in 1977. Ever since, political forces supporting
independence have been in power in Catalonia. Such sustained overwhelming position of the nationalist parties in Catalonia has resulted
in the rising support to independence among the region’s citizens. Mass
demonstrations were staged in in 2012 and 2013 with over one million people participating. Protesters clearly demanded the separation
of Catalonia from Spain by peaceful, democratic means. They called
for a referendum to vote for the independence from Spain. Another
milestone in the recent history of Catalonia is September 27th, 2012,
11 Althouth British government initially claimed that the referendum on independance
would be outside the purview of the Scottish Parliament, an agreement with the Scottish
government was eventually reached (the so-called: Edinborough Agreement, signed on
15 October 2012) on the referendum and the temporary granting of power to the Scottish
Parliament for its slating (done by a Royal decree). After that in March 2013, a draft Law
on the Referendum of Independence of Scotland was passed, defining the terms of its
impleemntation and 18 September was set as the date of the referendum. The Scottish
Parliament adopted the Law on 14 November 2014, and a month later, the Queen of
Britain gave it her consent.
187
when the Catalan Parliament decided to officially grant citizens the option to have their say on independence in a referendum. Although the
decision was passed with a two-thirds majority, central authorities in
Spain perceived it as a fundamental derogation of constitutional principles, particularly of Article 8 which guarantees the territorial integrity
of Spain and, should such attempts materialise, allows for military deployment to preserve the state unity (Carrera, 2014). The decision that
caused much concern to the Spanish authorities was passed in 2005,
when as many as 90% of the Catalan MPs voted in favour of amendments to the Region’s Statute and the proclamation of the Catalan nation. However, although the Catalan government passed a decision on
holding of a consultative referendum on 9 November 2014, the Spanish
Constitutional Court ruled that Catalans do not have the right to vote
directly on this issue. Still, Spanish Prime Minister Rajoy called this
attempt „pseudo-referendum“ that failed to meet any democratic requirements. (Mofett, 2014). On this occasion he reiterated his position
that Catalans could not exclusively vote on an issue which concerned
all Spanish citizens.
Independence aspirations exist, although to a lesser degree, also in
the region of South Tyrol in Northern Italy. As research carried out in
this northern region of Italy shows, a large majority of the local citizens
does not feel Italian nor has any common identity features with the rest
of Italy. (Marchetti, 2014). Also, it appears that the large majority of the
South Tyrol residents are German-speaking. One of the co-founders
of the separatist party Süd-Troler Freiheit, Eva Klotz, last year initiated
a survey on the possibility of a referendum on self-determination, in
which a vast majority of respondents supported this initiative. (Marchetti, 2014). In the same spirit, a member of the academic community Marco Brunazzo sees the problems in South Tyrol arising from
identity issues already at school-age due to a clear division according
to mother-tongue, which inevitably renders social integration in the
region impossible. It is crucial to emphasize that the distribution of
public functions and jobs follows the ethnic quota, meaning that for
each Italian-speaking employee a German-speaking one must be employed, too (Marchetti 2014). Yet, among the South Tyrolese, there are
those groups that do not support full independence from Italy, but only
greater autonomy from Rome. One of them is no doubt the South Tyrolean People’s Party which in its Programme of Action emphasizes the
need for greater autonomy for the sake of preserving identity. This
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party has the highest representation in the South Tyrolean Parliament, and its members sit in Italian and European Parliament. These
are the reasons behind comparisons of regional separatism in South
Tyrol with Catalonia.
In the context of these tendencies of growing regional separatism
and the current „referendum tide“ in West European states, even statements that today’s Western Europe is characterised by economic integrations, on the one hand, and by political disintegration on the other,
may appear acceptable at their face value (Alesina, Spolaore, Warciarg,
2000). However, we believe such assesments to be rather simplistic.
First, despite rising regional separatism, integration processes driven
by western countries progress in the economic, political and military
domains and furthermore, in the sphere of culture, with a tendency of
spreading into the realm of identity. On the other hand, when it comes
to political desintegrations, it has to be taken into account that they are
inevitably accompanied by not only social but invariably also greater
or smaller economic desintegrations and the same would, no doubt,
hold true for possible political desintegration of some Western European countries. Among other, recent public debates about the future
of Scottish EU membership in case of a „yes“ vote also pointed in this
direction: could it then retain its membership or have to reapply for it.
Some even contended that it would have to undergo the whole complicated entry procedure as all other countries striving to join the EU.
However, this view, probably developed for the purposes of London’s
campaign, does not seem very realistic, as this is a territory in which
European norms and standards are already in place. Yet, some EU officials in their addresses took a step further in discouraging the Scottish population to vote for independence. Thus, for example, European
Commission President José Manuel Durão Barroso alerted that some
member-states would surely stand in the EU way of Scotland (Kostić
2014). Yet, there were some far more realistic estimations like the one
that „independent Scotland would swiftly become the fully-fledged
member of the international community“ and that, regarding its EU
membership „political will to find a less complicated way than claimed
by some will be shown“.12
12 This assessment was made in the run-up to the referendum by British foreign policy
analyst and international affairs expert for South East Europe James Ker-Lindsay. See:
„Zašto škotski referendum brine Balkan“, RTS, 13 September 2014, www.rts.rs/page/
stories/sr/story (09/10/2014).
189
Regionalisation is a product of contemporary processes of globalisation and European integrations, as a parallel and closely associated
process. The fostering of regionalisation inside and across national
broders, and the formulation of the concept „Europe of regions“, has
led to strengthening of the sub-national, regional identities, which
was also seen as a way of weakening the national sense of identity in
Europeans, and consequently, creation of better conditions for the development and acceptance of the supranational, common European
identity (Mirović 2012). Due to these processes, “national cultures are
being squeezed between a broader popular culture and briskly reviving regional cultures... Regionalism, whether within or across national
borders, is Europe’s current and future dynamic, particularly for those
who see themselves belonging more to ‘Europe’ than to a nation state of
clouded origins or dubious boundaries“ (Newhouse 1997: 75). This has
certainly given impetus to the revival or emergence of disintegrational
tendencies within nation-states across the European Union.
The way in which this regional separatism is interlinked with the
economic dimension of the Western-type, neoliberal globalization
model was precisely explained by Alberto Аlesina and a group of authors. Their thesis is that in an environment of free trade and a global
market, the creation of small and homogenous political entities could
bring economic benefit to the small cultural, linguistic or ethnic groups.
Conversely, in the global context marked by trade restrictions regime,
political borders assume greater importance as they determine market
size and territorialy large countries reap economic benefits. One of the
arguments they put forward in support of this thesis is the fact that the
history of the nation-state creation and secession was dictated by the
prevailing trade model. (Alesina, Spoalore, Warciarg 2000: 1276) Motivation for the development of regional separatism in the EU, in their
opinion, lies in the fact that “linguistic, ethnic, and cultural minorities
feel that they are economically ‘viable’ in the context of a truly European common market, thus they can ‘safely’ separate from the home
country”).. (Ibid.: 1293)
Considering the aforesaid, it can be concluded that regional separatism and separatist movements in Europe have been on the rise over
the past decades. These tendencies are present not only in new democracies but also in the more developed ones. This is particularly manifest in southern EU member-states, where advocates of separation believe that their demands will not jeopardize their status in a broader
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Referendums in Europe
economic context. These demands have resulted in differences in the
interpretation of the right to self-determination, which in all international documents is guaranteed only to consitutive nations, but today
we are increasingly seeing involvement of ethnic minorities in the processes of separation from sovereign states. Precedents, principally that
of Kosovo and Metohija have largely contributed to this trend by paving
the way for more radical demands of minority groups within sovereign
states. It also steered ambitions toward referendums in order to decide on potential separation from states populated by different ethnic
and minority groups. In conclusion, it can be said that these radicalised
separation demands and tendencies put at stake not only the survival
of existing nation-states, but also the idea of a united Europe made up
of myriad national, linguistic and cultural identities.
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(Re)konstrukcija institucija: Godinu dana tranzicije u Srbiji (Collection
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Institute for Political Studies
UDC 614.2(497.11)
Manuscript received: 12.09.2014.
Accepted for publishing: 30.09.2014.
Original scientific paper
Serbian Political Thought
No. 2/2014,
Year Vl, Vol. 10
pp. 193-209
Natalija Perišić1
Faculty of Political Sciences, Belgrade
Health Care System between the State and
the Market – the Case of Serbia
Abstract
Serbia’s health care sector passed a long way from embracing state to market oriented values. During the first transition phase of the 1990s, health care
reforms were rather provisional and forced by unfavorable trends in the society, while in the second transition decade more comprehensive, yet incomplete
reforms, have been designed. The trajectory of main developments in the sectoral reforms clearly reveals a transformation of the national health care system
from the state through quasi-state and finally mixed state-market health care
schemes. Straightforward comparisons of access, quality and sustainability of
health care in the past and in the present are hard to be made. However, the
current reform outcomes reveal compromised accessibility, quality and sustainability of health care services. Those unresolved challenges have created room
for widespread corrupt practices. Currently their main source seem to be unclear relations between the public and the private health care sectors.
Key words: health care, reform, access, quality, sustainability, corruption.
Introduction
Health care reforms are generally subject to many important factors,
other than only economic. The Governments frequently show hesistance to introducing (radical) changes into their health care systems and
the population are highly sensitive to health care issues. The underlying
reason is that the „health care is a unique commodity“ (Pestieau 2006:
116). This paper focuses on health care reforms on the basis of the case
study of Serbia from the social policy perspective. The first Chapter
explores the welfare sectors providing health care, generally the public
1 Assistant Professor
natalija.perisic@fpn.bg.ac.rs
193
and the private sectors, trying to draw lines between their competencies
in the national context. A complex, nation-wide evaluation of implemented reforms in Serbia as of the 2000s is absent and the preferred
evaluation method of the paper is structured around access, quality and
sustainability of health care, as analyzed in Chapter 2. This approach can
be partially justified by the absence of many indicators and data necessary for an in-depth evaluation. The shortages of the health care system in terms of access and coverage, quality and performance, as well
as sustainability are reflected on corrupt practices. However of modified
forms during the different phases in the development of the society (socialism, transition, capitalism), they seem to be equally vivid and hard
to eradicate. Corrupt practices are presented in Chapter 3 in a qualitative and documentary manner, through examples from the practice
illustrative of the ways in which the health care system and individuals have been coping with the changes and challenges. Extrapolation
of deeper and generalized insights would need appropriate theoretical
background information, which is out of the scope of this paper. Finally,
a stronger emphasis in the paper is on the characteristics of the present
health care system.
Health Care System in the Past and in the Present
The oldest heritage of the national health care system is in the
Yugoslav self-management socialist concept which adopted the Bismarckian principles of health care insurance and adapted it to the
principles of solidarity, egalitarism and universalism in health care.
Consequently with the overall state ownership, the public sector was
the only provider of health care services. It was not until the 1980s
when the legal changes of 1986 and 1989 enabled the introduction
of private dental and private medical practices respectively. However,
numbers of private health care facilities were very low, while the state
sector remained absolutely dominant.
The achievements of the socialist health care model were mainly in
the spheres of eradication of many pre-war diseases and promotion of
public health, as well as in improvement of a series of health indicators,
such as life expectancy, mortality rates in general and especially in infants, etc. A significant progress was made in terms of developing previ194
Natalija Perišić
Health Care System between the State and the
Market – the Case of Serbia
ously underdeveloped network of health care facilities, using the then
modern medical equipment, raising the number of medical staff, etc.
Despite the positive developments, the challenges faced by the health
care system in the late 1980s, primarily regarding the improvement of
the health situation, have become increasingly complex and „the health
care needs of the population that were not followed by adequate state
measures have increased“ (Lakićević 1991: 351).
In the transition period during the 1990s, the Serbian health care system experienced its most severe crisis. Overall political and economic
circumstances in the society2 have coincided with the total collapse of
the health care sector.3 Almost all reported health care indicators were
aggravated during this period.
An enactment of health care system related laws of 19924 created a
paradoxal situation. On the one hand, many rules from the Laws were
not clear or were at least ambiguous – the definition of health care, the
competencies of certain agencies in charge of health care activities, the
founders of health care facilities, etc. and created a wide „grey“ zone
eventually susceptible to many corrupt practices. On the other hand,
some rules were not or could not be implemented – for example, the
voluntary health insurance, albeit they were provided for by the Law
(Pražić 1998: 169).
Despite actual impossibility to effectuate legally prescribed rights to
many health care benefits and services, the Government did not make
any legal changes. Therefore, a parallel health system was created, in
the shadow of the public sector. The private health care facilities were
2 The reforms of the 1990s were implemented in the context of extremely adverse trends:
1) in the political sphere: disintegration of Yugoslavia, civil war, sanctions of the United
Nations, bombing; 2) in the economic sphere: macroeconomic instability, sharp drop in
GDP, high foreign trade deficit and public debt, extremely low employment and activity
rates, high unemployment rates, enormously huge grey market, hyperinflation; 3) in the
social sphere: increased inequalities, drop in the living standard and widespread poverty,
major inflow of refugees and internally displaced persons, etc
3 It was manifested in numerious ways, with some of the following: „the state health
institutions did not provide even basic hygienic conditions, and there were no
prerequisities for medical check-ups and hospital treatments. At one time, almost a
complete interruption in the supply of medicines and medical materials occurred and
obsolete technology disabled medical procedures and surgeries“ (Vuković, Perišić
2011: 234).
4 The subjected Laws are the Law on Health Care and the Law on Health Insurance, both
of 1992.
195
flourishing in the first transition years. By part-time engaging the medical staff (employed in the public sector for extremely small wages), they
were offering value for money.
The first strategic paper was enacted two years after the political
changes of October 5, 2000 and later in comparison with reforms in other welfare programs. Only in 2005, the new Laws regulating health care
and health insurance were adopted. The dominant health care services
provider is still the state and the organization of public health care facilities has been characterized by insufficiently clear division of levels of care
(Simić, Marinković, Boulton 2012: 105-107). Compared to the period of
socialism, the most striking changes were made with the introduction of
mandatory health insurance and the widening of the scope of work and
types of private health care services. Benefits’ package and the rights in
the public health system in the Law of 2005 have become significantly
reduced compared to the previous Laws regulating this area. From the
point of view of those in favour of savings in the health care system, that
reduction is not sufficient and the rights (as well as the claims) should be
scrutinized furthermore. There were many cuts in the number of beds
and also in the number of both medical and administrative staff in the
sector, frequently with unexpected and negative consequences.
Along with the dominance of the public sector, the activities of the
private health care sector have been steadily increasing. They are mainly
offered at the level of primary health care, but also at the level of highly
profitable specialized health care services. However, any of the so far
implemented reforms did not prevent the parallel existence of the two
sectors. The functioning of the private sector is still lacking completely
clear regulations, resulting in unfavorable consequences for the population. Some of the consequences relate to paying significant funds to private health care facilities, despite paid contributions to the public Health
Insurance Fund. Along with the lack of consistence with the reform
objectives, a part of the agenda from the beginning of the 2000s which
was not implemented, was actually the problem of relation between the
public and private health care sectors and the functioning of the latter.
The only drastic changes compared to the socialism and the 1990s have
been made in dental care: Only children and preventive dental care have
remained within the state sector. A progress was made in the sphere of
obligatory licencing of staff employed both in the public and the private
health care sector, but the accreditation of facilities is voluntary so far.
196
Natalija Perišić
Health Care System between the State and the
Market – the Case of Serbia
Private health insurance has a short history – it is regulated by a
Regulation of 2008,5 which disables reliable estimations of its impact.
Ten insurance companies are active in the field. The role of the state is
reduced to giving licences to the insurance companies to deal with the
activity of private health insurance. Private health insurance is designed
as a form of substitution for those without a public insurance and for
those opting for higher standards, i.e. other benefits and services compared to the existent in the public insurance.
Indicators of Health Care Provision and Organization
Coverage and Access to Health Care Services
The socialist state incorporated in its Constitution and laws the right
to health care for all. The practice evidenced that the mentioned right
had a different scope for different groups in the society. Probably due to
high centralization in the health care sector characteristic of socialism,
health care facilities and medical professionals were not equally distributed throughout the country. Consequently the population in certain
areas (especially those underdeveloped) was facing factual geographical
inaccessibility of health care services (Lakićević 1991: 351), especially of
specialist care.
The most striking gap between the proclaimed rights and their actual implementation existed in the period that followed, i.e. in the 1990s.
The exit strategy of the Government was to keep the status quo in the
laws. “This created a superficial impression of the functioning of the
(public) health care sector and prevented the problem to come out of the
shadow” (Dimitrijević 1999: 284-285). Also, by-laws were frequently de
facto narrowing the rights proclaimed in the laws. Geographical inaccessibility continued to be present, but not in all parts of the country:
For example, the best developed network of health care facilities was
characteristic of Vojvodina, contrary to the Central Serbia, while on
Kosovo and Metohija there was no even enough medical staff (Pražić
1998: 176-177). In the 1990s, the challenge of inaccessibility additionally translated into the challenge of affordability: already impoverished
population was forced to pay for health care, either under-the-table to
5 The Law on Health Insurance of 2005 introduced the voluntary health insurance, and the
Regulation on Voluntary Health Insurance in Serbia was enacted in 2008.
197
the public sector or legally to the private sector. There are empirical evidence that the effects of health care costs in either of the two ways were
devastating to households’ budgets (Vuković, Perišić 2011: 234).
According to the official statistical data, the current coverage rate
with health care services accounts for app. 95-96% of the population
(RFZO 2013: 11). Albeit almost universal coverage reported from public
sources, researches into social exclusion bring different data: a research
by Cvejić, Babović, Petrović, Bogdanov and Vuković of 2010 points to
inadequate coverage of elderly in rural areas of the country, even with
primary health care. According to the statements made during the research, 12.6% of the respondents did not have health insurance, while
20%, 8% and 17% due to lack of money could not buy necessary medicines, medical appliances and pay for specialist check-ups respectively
(Cvejić, Babović, Petrović, Bogdanov, Vuković 2010: 84-86). The coverage rate is the lowest in Roma population: Even 24.7% of them could not
effectuate the right to health care (Vlada RS 2011: 177).
A study by Idzerda, Adams, Patrick, Schrecker and Tugwell of 2011
suggests that availability of health services is not an issue that disproportionately affects the Roma, but the geographical accessibility and affordability (both of services and medications) (Idzerda, Adams, Patrick,
Schrecker, Tugwell 2011: 10). The issue of geographical inaccessibility
is connected with the secondary and tertiary health care. The World
Health Organization applied Primary Care Evaluation Tool to find out
that 2/3 of respondents could reach their physician or pharmacist in less
than 20 minutes, but not the dentist. Contrary to that, only 20% of respondents could reach the hospital in the mentioned 20 minute time
(WHO 2010: 10-12).
There are strong differences between the average population and
20% of the poor regarding the indicators of “inability to access health
care due to financial reasons” and “inability to provide medications,
medical treatment and orthopedic appliances due to financial reasons”
(Vlada RS 2012: 41). These findings are supported by the recent survey data that every tenth respondent reported that he/she did not visit
a physician, at least once during the year, because of the lack of money
(IJZ 2013a: 46). A comparative survey of health care systems in 34 European countries of 2012 (European Health Consumer Index) positions
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Health Care System between the State and the
Market – the Case of Serbia
Serbia at the bottom of table of European countries6 primarily regarding
the accessibility to surgeries and diagnostic treatments.
The number of the population contributing to private health insurance schemes is low – in 2010, there were less than 100,000 payers (NBS
2011). Furthermore, private health care facilities are not equally distributed in the country. Due to higher demand, the majority of them (almost 80%) are in the capital city.
Quality of Health Care
From the perspective of health indicators of the population, quality
of the socialist health care was undisputedly advanced compared to the
pre-war period. From 1948 to 1989, life expectancy increased from 50 to
72 years of life. Even though this and other health indicators were lower
compared to highly industrialized countries, they were still above the average values in the countries of Central and Eastern Europe (Čekerevac
2007: 34). Also the causes of deaths were rather similar to those in developed, and not the developing countries. The number and qualifications
of medical staff were in the trend of raising and improving. However, increasing inconsistency between the benefit package and available funds
for health care with consequent continuous inflow of more and more
beneficiaries, along with the ageing of the population, their increased
expectations, etc., finally resulted in decreased quality of the services.
Thus, already at the beginning of the transition, quality of health care
services was compromised and the situation was continuously aggravating to result in „a complete breakdown of supplying medicines to health
care facilities, outdating of technology and inability of performing even
urgent surgeries [...] aggravated hospital treatments, extremely bad
hygienic conditions in health care facilities, etc.“ (Vuković 2009: 132).
Unsurprisingly, health indicators of the population become highly unfavorable. The internal supervision of work and of quality of provided
services was done only sporadically, while the regular and extraordinary
supervision by external organization was not done at all (Pražić 1998:
187). The quality of private health care services was significantly better
in many ways, even though only anecdotal evidence can be found in
6 With 451 points out of 1,000, Serbia is on the 34th position out of 34 European countries,
based on 42 indicators classified into five categories (HCP 2012: 15).
199
support to this: experiences of the citizens visiting private doctors are
that [...] the quality of their services is, generally speaking, on significantly higher level in the majority of private facilities. The owners of
private health care facilities bought new and state-of-the-art equipment
and engaged the best professionals from the public facilities to work as
their consultants (Dimitrijević 1999: 298).
Currently, the basic methods of measuring quality of health services
are two health indicators (life expectancy at birth and infant mortality
rate) and surveys on the satisfaction of patients with the public health
facilities and staff employed in them. The mentioned health indicators
show improving results, but still huge differences for certain groups in
the society have remained. Life expectancy for the Roma is 10 years
shorter, while mortality rate of Roma children is two times higher than
the national average, and 20% of Roma children are ill conditioned
(compared to 7% of children from general population) (Vlada RS 2011:
187). Self-perceived health status is different depending on the income
of households: It is bad and very bad in 32% of the lowest quintile, contrary to 12% of the highest quintile (Vlada RS 2012: 28). A survey on the
satisfaction of patients with the public health facilities of 2012, reveals
surprisingly high, although decreasing satisfaction (3.96 out of 5). The
satisfaction in staff employed in the public sector is also decreasing (IJZ
2013b: 3).
The assessment of the World Bank of 2009 on improved situation
in the public health care sector in Serbia was based actually on achievements in the system management, and especially: reconstruction of several health centers, as well as some hospitals and clinics, improvement
of medical equipment and capacities for the national production of vaccines, establishment of professional chambers, foundation of the National Agency for Quality and Accreditation (Svetska banka 2009: 22).
It seems that there are significant regional disparities in practice, in
terms of quality of provided services. As a rule, better quality of services
is provided in major medical centres, especially in bigger cities and at
secondary and tertiary levels of care.
The data about the quality of services offered in the private sector
have been mising to a large extent. An efforts to include the private sector into the program of a continuous quality improvement failed, but
the reporting on the use of private health care services (as as well the
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Health Care System between the State and the
Market – the Case of Serbia
registered morbidity) has been improved. For a couple of last years, the
private health sector has been subjected to a regular auditing.
Sustainability of Health System
There are indications that the first signs of the crisis in health care
financing coincided with the economic crisis in the Yugoslav society at
the beginning of the 1980s, which reflected in slight decrease of health
care expenditures as a GDP percentage (from 5.76% in 1980 to 5.14% in
1982). In 1989, they were 5.6% – almost at the same level as a decade ago.
However, the GDP was shrinking and the actual funds devoted to health
care were decreased, along with increased number of the population.
During the 1990s, the health care system was openly unsustainable. The amount of contribution collected funds was insufficient, as a
consequence of nominally low salaries, depreciated by hyperinflation.
Furthemore, the collection of health care contributions was extremely
low – the practice of employers to avoid paying social contributions was
wideapread and yet tolerated by the Government. After that, from 1997
to 2001, health care expenditures per capita were significnatly oscillating (graph 1), with constantly increasing trend from 2001 onward. In
2009, the trend was interrupted for the first time after the beginning of
the 2000s, as a consequence of reduced economic activities.
However, the share of expenditures for the public health care system
in GDP is higher compared to the health expenditures in the countries
in the region while the results or outcomes of the health system are average (FREN 2010: 167). The reason for that is significantly lower productivity of health services (Svetska banka 2009: 28).
Another big challenge are high private expenditures for health care:
the so-called out-of-pocket payments are made mainly, but not exclusively, for those medicines which are not on the positive list. These expenditures amount to about 25% of total expenditures on health care,
which ranks Serbia high compared to many other European countries.
Even worse, data from the National Health Account in Serbia suggest
that more than 35% of costs of health care are financed by households.
Thus, private expenditures for private health care services significantly
increase household expenses.
201
Graph 1: Health care expenditures per capita, in US$, from 1997-2007.
Source: IJZ, 2008.
Pending financing reforms have been reported to present the key
challenge to the health care system in many studies.7 The secondary and
tertiary levels of care are over-dimensioned, even though the primary
level was conceived as a gate keeper in strategic documents. It has clearly
led to irrational usage of available (deficit) resources. The relief was expected to come after the introduction of new payment mechanisms –
capitation at the primary health care and diagnosis-related groups at the
secondary and tertiary levels of care. While the capitation system was
finalized in October 2012, the diagnosis-related groups system has been
piloted. The first findings point that the new payment methods did not
generate expected results (RFZO 2013: 12). Despite the developments,
the sustainability of health funds remains at further risk, partially due
to underdeveloped mechanisms of enforcement and control (European
Commission 2013: 36).
Corrupt Practices in Health Care Sector
Available scientific papers and books from the socialist period approached the problem of corruption in health care primarily from the
7 Some of them are: Social Protection and Social Inclusion in the Republic of Serbia by
the European Commission of 2008; Reforme u Srbiji: dostignuća i izazovi by Mijatović
of 2008; Socijalna sigurnost by Vuković of 2009; Srbija: kako sa manje uraditi više suočavanje sa fiskalnom krizom putem povećanja produktivnosti javnog sektora by the
World Bank of 2009, etc.
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perspective of its devastating effects on solidarity and equality in the
socialist regime, highly immoral behavior, the so-called “residues” of
capitalist past which will be overcome with the development of the socialist society, etc. Broadly, the corrupt practices from that period were
most frequently referred to as “abuse of a position” and “deriving personal benefits from being on a privileged position” (Kočović 1997: 165).
Those could be taken as to refer at least to providing the medical staff
with gifts in kind, and probably even cash payments. It could be that the
first mentioned was relaxed by those taking them as widespread cultural
norms of kindness in the Serbian society and by those offering them
as a gratitude and/or an expectation of obtaining better care and treatment. Efforts to evaluate the dimensions of health related corruption
were taken rarely, probably partially due to absence of evidence from the
practice, i.e. researches in support of theoretical statements.
The changed nature of the health care system in the practice, despite
minor legal changes, resulted in dramatically changed corrupt practices,
which became a common norm in the 1990s. The corruption has become built-in in the health system of that time. One of the sources of
corruption was derived from the characteristic of the Serbian political
system and monopolistic position of the governing party during the
whole 1990s. Its impact on all spheres of the society (and among other
things on the health care system) was decisive. Functioning of the Republic Health Insurance Fund during the period was characterized by
widespread practices of using money allocated for one purpose for another. Because of close connections between the Managers of the Fund
and the political party in power which was appointing them, collected
funds were used for paying political campaigns for elections, but also
for paying pensions and other benefits. Even though insufficient for the
health care of the population, the collected funds were high, and the
turnover was high for that time. „The astonishing facts that the audit of
the Health Insurance Fund has not been done for more than 10 years
during the nineties, or that 10 out of 12 HIF Managers were at one point
put in prison, speak for themselves!” (Arandarenko, Golicin 2006: 270).
Not only at the level of the Health Insurance Fund, but also at the level
of public health care facilities, a huge space for corruption was offered by
the procedure of the so called public purchases.
Another massive corruption path was connected with a narrow circle
of medical doctors on high positions in the political hierarchy. Health
care facilities that were managed by them had an access to top quality
203
equipment and top educated personnel. Furthermore, there were indications that employed in those facilities were receiving higher salaries
compared to others (Dimitrijević 1999: 285). Not only that they benefited in terms of that, but also not all patients could approach to those facilities. Because of the restrictive policy of service provision, those facilities benefited from those for whom the only option for admission was to
bribe someone. The latter stem from another feature of the health care
system of the time: On the one hand, there were too many by-laws, and
on the other hand, their implementation was very selective, resulting
in extreme inequalities in access to health care, despite formally equal
rights.
That irreversibly led to widespread giving under-the-table payments,
most frequently in the form of cash payments. In general, there were
several corrupt practices on the individual level during the 1990s in the
public facilities: Asking cash payments from patients in order to obtain
a necessary treatment or to obtain it without waiting; Asking from patients to buy necessary supplies (there were no basic supplies in certain
health care facilities); Directing patients to private health care facilities
in which the same doctor employed with the public facility provides a
service or vice verse, asking cash payments even when the private practicing doctor provides a service in the public facility; Asking cash payments for signing documents enabling a patient to effectuate the right
to disability pension. A survey conducted by the Centre for LiberalDemocratic Studies reported that every second respondent had a personal experience in corruption practices related to health care (Begović,
Mjatović 2001: 123). These findings could point that under-the-table
payments were actually the surviving strategy for many who needed
health care services.
In its Health Policy of Serbia of 2003 transparency was listed as one
of the development objectives of the national health care system. Ten
years after that, in its Progress Report for 2013, the European Commission finds that the health care sector in Serbia is particularly vulnerable
to the corruption. While “in theory all agree that the corruption must
stop, in practice it is not the case” (Dickov 2012: _). Stabilization of the
situation in the health care sector after 2000 did not end the corruption. Now it mainly stems from unclear relation between the public and
the private sector, and could be that it is supported by the situation in
which the medical staff in the public health care facilities is overloaded
but underpaid.
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The private health care sector and “increasing the participation of the
private, profit and non-profit sector in rendering health care financed by
the Republic Health Insurance Fund” (MZ 2003: 5) as regulated by the
fifth principle of the Vision of Health Care System in Serbia starts from
the need to offer more diversified health care services, but also to monitor the quality of private services. Since it means the inclusion of the
private sector into offering services (and even some specific services of
public health) through contracting with the public Fund, it could be reasonably expected that the (better) integration of the two sectors would
decrease opportunities for corruption. However, the current legislation
on sub-contracting services, for which the Republic Health Insurance
Fund would pay to private physicians, has not affected the change in
the public-private mix, since this model has not been used in practice.
Reasons for that are partially a result of “overlapping public and private
health sectors, widespread corruption and inability of the state to introduce control systems” (Vuković 2010: 215). The practice has shown that
the so-called temporary engagement in the private sector of physicians
employed in the public sector is not a realistic solution for legal connection of the public and private health sectors in Serbia.
Estimated data of the United Nations Development Program for the
health sector show that an average amount of bribe in 2009, 2010 and
2011 was EUR 169, 225 and 178 respectively (Doktori protiv korupcije
2014). The decreasing trend could be possibly interpreted in terms of
a severe hit of the world economic and financial crisis on household
incomes in Serbia. Unsurprisingly, in most cases (70%), this payment
had an impact on personal budget to a great or moderate extent (UNDP
Serbia 2011: 9). The reasons for that could be easily found by comparing
the average and minimal salaries in Serbia with under-the-table payments. However, there have been significant difference of the amount
and frequency of these payments, depending on the type of specialist
care. Informal payments are higher and more widespread in gynecological and surgical facilities, while they are generally less frequent in
outpatient services.
The results from the last, seventh research cycle of CESID and UNDP
of 2016 show that the highest number of corruption cases is reported
within the health care system with 47% of direct corruption experiences
in the past three months related to physicians (UNDP Serbia 2013: 8).
Accordingly, the population is accustomed to corruption – 88% agree
that corruption is common place in Serbia (UNDP Serbia 2009: 12).
205
There are differences in the perception of corruption based on the living standard: the better-off perceived the corruption as a lower priority
problem, contrary to the population with average and especially above
the average income. Citizens seem to underestimate their possible role
in the fight against corruption. Slightly more than half of respondents
(52%) think that there is less corruption thanks to citizens themselves,
while 57% think that a person giving a bribe is as responsible as the one
accepting it. The reasons for that are numerous: (relative) tolerance of
the Governments towards the corrupt practices, rare and slow judicial
processes related with the corruption in health care, etc.
Conclusion
The process of the national health care system transformation followed the trajectory of reduced state responsibilities and activities in
many ways. Faced with ever increasing demand for health care services
and decreasing capacities to meet the (un)justified demand, the Government has been using different rationalizing paths. However, the health
care reforms have been characterized to a large extent by unclear and
sometimes ambiguous objectives. Legal changes have been directed toward the market logic, but the clear relations between the public and the
private sectors have not been delineated and implemented. An absence
of a dialogue between the decision makers and the public contributed to
such a situation. An excessive impact of political parties in the reforms
(i.e. the political power of levying own agenda has been frequently the
main argument for reforms), has been delaying the necessary steps and
making the situation harder. National decision makers were the most
hesitant to reform the health care system and therefore many measures
were taken on an ad hoc basis. Due to that, their maneuver space has
become significantly reduced and currently weaknesses of the system
seem rather more pronounced than its strengths.
Straightforward comparisons of access, quality and sustainability of
health care in the past and in the present are hard to be made not only
due to nonexistent and different indicators, but also due to higher expectations and aspirations of the citizens. Currently, the health care system
faces fundamental challenges to access (low access in practice, especially
of certain groups, aggravated affordability and unequal geographical accessibility) to quality (lowering satisfaction of patients and professionals,
206
Natalija Perišić
Health Care System between the State and the
Market – the Case of Serbia
lagging behind the EU regarding health indicators) and to sustainability
(low health care expenditures which yet jeopardize the GDP). These obvious weaknesses are additionally potentiated with those indirect: e.g.
limitation of health care “basket” covered by the public insurance system, rather low quality standards, very low (and decreasing) GDP, etc.
It seems that the future changes to the system will be made within the
framework of financial constraints in the system and the period of the
current crisis will not present a favorable moment for the creation of a
sustainable system. That brings into arena concerns about even higher
levels of corruption, then currently. High vulnerability of the national
health care system to corrupt practices will remain in case of persistence of current model of relation between the public and the private
sectors. The concept of the private sector development should take into
account that it will not solve the health problems of the most vulnerable
and that the purchasing power of the population is comparatively very
low. Therefore, obstacles referring more specifically to the public sector
should be eliminated: Reviving the discourse on solidarity and mutuality in the society and in health care sector especially; Eliminating discretionary interpretation of rules and shortages in equal treatment for all;
Improving the management with waiting lists and usage of technology;
Creating shared responsibilities for outcomes, etc.
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210
Institute for Political Studies
UDC 330.34+338.2+336.1/.5(438)(470+571)(049.3)
Book review
Serbian Political Thought
No. 2/2014,
Year Vl, Vol. 10
pp. 211-115
Despot Kovačević
Institute for Political Studies, Belgrade
Capital, Coercion, and Postcommunist States
Gerald M. Easter
Cornel University Press, New York, 2012.
Gerald M. Easter, doctor of
Philosophy from Columbia University and professor of comparative politics at Boston College, is
the author of book Capital, Coer-
cion, and Postcommunist States.
His research interests include the
modern state, comparative political economy, and post-communist
transition with a regional focus
on Eastern Europe. This book is
one of those with the main focus
on the theme of state-building in
post-communist space. Capital,
Coercion, and Postcommunist
States is a history of post-communist Poland and Russia with
understanding of the interactions
between taxation and governance.
This book is recommended
reading not just for political scientists, journalists, historians,
sociologists, but also for anybody
interested in the state issues.
Capital, Coercion, and Postcommunist States is important contribution to the literature on transition, democratization and the
211
consolidation of democracy in
post-communist countries, with
special emphasis on tax policy
and political economy.
This topic is especially important in the former Eastern bloc
countries, where ‘’state buildings
begins with the state already in
possession of power resources in
relation to society – the inheritance of the old regime’’ (p. 2). Beginnings of this process occur in
the context of absolute domination of the state and poorly developed or non-existent civil society.
The analytical framework of
the book is based on realist intelectual tradition and view of state,
associated with Niccolo Machiavelli and Max Weber. In the realist
view, state is an actor which competes with society over resources
– capital and coercion. As pointed
out by Easter, ‘’capital is manifested in kind, cash or credits and
coercion manifested in the means
of violence, bureaucracy and law’’.
This book of Gerald Easter has
the similiar analytical order as a
book by Charles Tilly „Coercion,
Capital and Europen states“.
The central thesis of the book
is that the post-communist countries are divided into two ideal
type models: a) ‘’contractual’’ and
b) ‘’predatory’’. The first model,
contractual state, is based on depoliticized coercion resources,
that are under civilian control,
212
placed in institutions and not personalized as in the former regime.
In the contractual states capital
was transformed – economic resources were transformed into private property and political power
is based on institutional checks
and balances. Author concludes
that “contractual states are much
more successful in establishing a
consolidated democracy”.
The secound model, predatory
state, is based on means of coercion, which are still monopolized
by politicians; political actors with
the lack of control by civilian actors. In these circumstances,
capital is still largely in the hands
of the state with some private
ownership, where boundaries between state and society are hardly
distinguishable. Such systems are
suitable for totalitarian and authoritarian rules.
Easter consideres Russian Federation as an example state of the
first model, and Poland as an example of the second one. In studies of post-communist countries
these two examples are often used
as the best indicators of different
ways of the system transformation. A good example is a comparative analysis written by Davor
Boban called “Semi-presidential
systems of Russia and Poland”.
The book is organized into six
chapters, each set up as a stage in
the transformation of the system.
Chapters show two ways of statebuilding which are closest to the
ideal type models.
In the first chapter ‘’Toward a
fiscal sociology of the postcommunist state“ author presents a
review of literature about state
building, postcommunist states,
tax politics in comparative perspective and transformations of
political systems. At this point,
Easter represents all possible
models leading to the construction of “new democracy” and the
market system. It is important to
note that the author emphasizes
the critique of the neo-liberal
approach to the problems of the
Eastern Bloc.
Basic dilemma among professionals dealing with these issues
is “whether the establishment of a
market economy needs a strong or
a weak state?”. Because this often
depends on the context in which
the process is taking place, the
question remains unanswered.
The second chapter, as an important part of research, describes
the fiscal crisis in Russia and Poland that led to the collapse of the
regime. This prehistory is very
important as a set of conditions
affecting the new system and its
capabilities. Some authors say that
the character of the old regime is
the most important condition for
the establishment of the new regime. In this direction, Easter is
explaining the nature of the fiscal
crisis in mentioned countries.
Tax reform represents a crucial
component in further writting of
Gerald Easter in his third chapter.
The main question is why some
of the countries, after the regime
changed, conducted the entire tax
reform, while other countries have
not undertaken this important
step. Easter argues: ‘’’two waves
of tax reform surged across Eastern Europe in the postcommunist transition. First, in the early
1990s most postcommunist states
adopted macrolevel tax policy reforms modeled after the advanced
capitalist states. These reforms
aimed to redirect the state’s fiscal
focus from the point of production to consumption, from corporate to individual tax payers, from
big to small entities, and from
closed to open markets. Second,
in the 2000s some postcommunist
states... fashioning more streamlined and simplified tax systems.
This second reform was intended
to overcome a set of obstacles to
revenue extraction that were particular to transition economies:
low tax morale, weak tax administration and scarce investment
capital’’ (p. 51).
This chapter also explains the
basic difference between Russian
and Polish tax reforms. In fact,
in Poland a “state-labor” revenue
bargain was crafted between pub213
lic sector workers and public welfare recipients and the ex-communist social democrats, while
in Russia, a „state-elite“ revenue
bargain was formed between regional and economic elites and
the ruling party.
Fourth chapter is dedicated
to answering the simple question
“Why people pay taxes?”. The
motives are various and the author points conducts comparative
analysis of two ideal type models:
the payment of taxes based on the
“legalistic consent” and the one
based on “bureaucratic coercion“.
The first one, based on ‘’legalistic
consent“, is the Polish transitional
tax regime which is reflected in the
revenue extraction. It was deliberately designed to protect capital
from coercion. In contrast to this
approach, in Russia, the tax regime is implemented on the basis
of ‘’bureaucratic coercion“ which
is reflected in compliance through
fear rather than through consent.
Easter concludes: ‘’When a former policeman, Vladimir Putin,
became president, coercion became a more credible component
of tax collection. Transitional tax
regimes, in turn, directly influenced the institutional outcomes
in the postcommunist transtion.’
(p. 6)’
Building Fiscal Capacity in
Postcommunist States - chapter
five is a study of institutional per214
formance. Easter compares the
process of building fiscal capacity
in post-communist Poland and
Russia with two test cases provided by international finance to
gauge fiscal capacity: a) first test
came from worlwide financial run
on emerging market economies in
1998 in Eastern Europe, b) second
test came in 2008 when ‘’buble
burst on series of speculative Wall
Street investment ventures’’.
On the first test, Russia and
Poland have responded differently. „Poland’s transitional economy not only avoided financial
collapse but recorded modest
growth. On the other hand, Russia succumbed to fiscal collapse
when hit by international financial crisis“(p. 125). On the second
test Polish and Russian responses
were not fundamentally different – state fiscal capacity of both
states was strong enough to prevent the financial collapse.
An important aspect arising
from the institutional arrangements and tax policy is the relationship of society and the state.
Redistribution of power between
state and society is based on the
tax regime and its institutional
components. In Poland, coercion
was tamed and subordinated under the ‘’rule of law“. On the other
hand, in Russia, coercion remained politicized and an instrument of ‘’rule by law“. State build-
ing in postcommunist states is
primarly reconfiguration of capital and coercion and, at the same
time, reconfiguration of state and
society.
In conclusion, we can say
that this book gives an excellent
overview of relationship between
economic and political factors of
the transition. The connection
between capital and coercion
substantially affects the democratic system and the interactions
among these two processes are essentially determined by the nature
of political system. Studying these
processes is crucial for understanding basic political developments at the end of the 20th and
the beginning of the 21st century.
For all these reasons, this book is
an invaluable piece of literature
for every political scientist, historian or journalist involved in
research and explanation of these
processes.
215
216
Citing and Referencing
We welcome articles reporting research on substantive topic, concepts, and/
or methodologies in all fields of political science. Authors of single country cases
are strongly advised to consider the theoretical and comparative implications of
the case. All articles are refereed by domestic and international experts in the
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September 15 (for Issue 2).
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217
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and last page numbers followed by full-stop.
Еxample: Parekh, B. (1996) “Political theory: Traditions in political
philosophy“. In: Goodin, R. E., Klingemann, H. (eds.) A New Handbook of
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Kipper, D. (2008) Japan’s new dawn, Popular Science and Technology, [online]
Available at: http://www.popsci.com/popsci37b144110vgn/html [Accessed
22 June 2009].
Intext reference: (Kipper, 2008).
218
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одговорни уредник Живојин Ђурић. Vol. 1, br.
1/4 (1994) - . - Београд ( Светозара Марковића
36) : Институт за политичке студије,
1994 - (Београд: Еseloge d.o.o.). 23 см
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